Oral Answers to Questions

WORK AND PENSIONS

The Secretary of State was asked—

New Deal

Laura Moffatt: How many disabled people the new deal for disabled people has helped back to work.

Alan Johnson: Since the national launch of the programme in 2001, more than 45,000 people have gained a job through new deal for disabled people.

Laura Moffatt: I am sure that everyone is delighted to hear that news, but it is important to say that when disabled people need access to the workplace they require extra help and support. This fantastic programme has provided that. Will my right hon. Friend tell the House exactly what extra training goes on with advisers to assist people with disabilities into the workplace?

Alan Johnson: The important contribution is made by the disability employment advisers: their expertise, as well as the involvement of the employer through various groups, has given us those extraordinary access figures. It might be as well to point out that the 45,000 figure is the number of disabled people who have obtained work through the new deal for disabled people. As a result of all the new deal programmes taken together, however, 180,000 disabled people have found work, so we are talking about the expertise not only of the disability employment advisers in the new deal for disabled people, but of those who work in other programmes under the new deal.

Paul Holmes: What reassurance can the Secretary of State offer to those organisations such as the Shaw Trust and the Groundwork Trust, which are being told this year that they must cut back on the number of disabled people whom they are successfully placing in work?

Alan Johnson: The reassurance we would give them is the reassurance that we have already given them; the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Liverpool, Garston (Maria Eagle), has made that clear on several occasions. We are looking very carefully at the needs of providers. This is a problem of success in the sense that the Shaw Trust, which does a marvellous job, as do the other providers, has been more successful than we thought in getting disabled people into work. We are constantly evaluating the programme, and we are having regular discussions. We think that as this is, uniquely, an outcome-funded arrangement, we can find a solution to the problem that the Shaw Trust has identified.

Pensioner Poverty

Alistair Carmichael: What steps he is taking to tackle pensioner poverty.

Alan Johnson: We have taken many steps to tackle pensioner poverty, including the introduction of pension credit and winter fuel payments. As a result of those and other measures, during 2004–05 we will be spending nearly £10 billion more on pensioners, including £5 billion more on the poorest third. That means that the poorest pensioners are, on average, £1,820 per annum, or £35 a week, better off in real terms than they would have been under the 1997 system.
	I am today publishing in the Library the pension credit take-up figures to September 2004. They show that pension credit is playing a vital role in helping to give more money to the people who need it most: 2.62 million pensioner households are benefiting, with 3.18 million individuals receiving an average award of about £41 a week.

Alistair Carmichael: I thank the Secretary of State for that very full answer. He will be aware that his Department's own figures showed that in 2002–03 some 2.2 million pensioners were still living below the poverty line. Given his welcome recent statements in which he accepts there were problems with pension credit take-up and that it provides a disincentive to save and his acknowledgement that he is veering towards the idea of a citizen's pension based on residency, how much longer will he be veering and when might we eventually see flesh put on those interesting and laudable ideas?

Alan Johnson: I can veer exhaustively; I shall be veering for a while longer. On the particular point about pension credit, in the hon. Gentleman's constituency 1,858 households and 2,153 individuals are benefiting. While the issue of take-up should be at the forefront of our minds, we are two thirds of the way towards our target in a third of the time available. Pension credit has just passed its first anniversary, and in Orkney and Shetland and elsewhere it is making a remarkable contribution.

Stephen Hepburn: Why are we, on the one hand, quite laudably giving out those benefits to pensioners to reduce pensioner poverty yet, on the other, making it harder and harder for them to collect those benefits by allowing the closure of post offices? I know it will be said that that is a matter for the Post Office, but will he use his good offices through the Department of Trade and Industry, his own Department and, indeed, the head of the Post Office service to ensure that pensioners' considerations are taken into account before any future closures?

Alan Johnson: That takes me back to Department of Trade and Industry questions when I started off as a Minister. I understand the importance of my hon. Friend's point. We are the first Government to provide £2 billion a year to protect the rural network and post offices in urban deprived areas. As for the rest of the network, sub-postmasters told us that they needed to ensure that they had the capability to make a proper living; otherwise they would go out of business. That is what the urban regeneration programme is about.

Peter Tapsell: Will the Secretary of State publicly castigate a solvent foreign company that is threatening 400 of its former British employees with pension poverty? Has he seen the documents that I sent to his helpful Minister for Pensions from those pensioners, showing that Nikko Europe plc put its British pension scheme into wind-up in deficit on Christmas day 2001? Despite Nikko declaring profits last year of more than $400 million, it has so far declined to make good the deficit, as it could well afford to do, and is forcing those 400 deferred pensioners through a period of prolonged and acute anxiety.

Alan Johnson: I understand that the employer, as the hon. Gentleman said, is solvent. The hon. Gentleman has been in correspondence with my hon. Friend the Minister for Pensions and now that he has raised the matter at Question Time, I will take a personal interest in it.

Frank Field: Does the Secretary of State realise that in his enthusiasm to counter pensioner poverty, the Liberal Democrats may have misread the answer that he gave at our last Question Time? Does he accept that while a citizenship pension might be a useful, additional tool to help the very oldest of our pensioners, it is not an avenue down which the Government are going, and that while our national insurance scheme has disadvantages, which need reform, reform will come in that direction and not via a citizenship pension?

Alan Johnson: That answer was not given at the last Department for Work and Pensions questions but during the Opposition day debate on pensions two days later. Let me make this point: the problem that I am interested in tackling, which Members on both sides of the House should be interested in tackling, is pensioner poverty. Two thirds of those in abject poverty are women, for the very good reason that they have not built up enough national insurance contributions. Fifty per cent. of women do not have a full state pension, compared with only 10 per cent. of men, and some women retiring now are in the same position. I reassure my right hon. Friend that we are determined to resolve that problem. The citizen's pension is one way of doing so—I have no wish, as I said recently to the Select Committee, to abrogate the contributory principle or to create more problems than we solve. I am concerned to overcome pensioner poverty, however, as we all should be, as it is a very real problem for millions of women in our society.

David Willetts: May I ask the Secretary of State about another aspect of pensioner poverty? Tackling pensioner poverty in the future means insuring company pensions with an effective pension protection fund. We agree with the Government on that, but it would be perverse if a flat-rate levy penalised well-funded schemes. Will he tell the House today what position he will take on the defeats that the Government suffered in the other place last week? Will the Government seek to reverse their decision to introduce rapidly a risk-related levy that is significantly bigger than the flat-rate levy?

Alan Johnson: I have committed the Government, as has my hon. Friend the Minister for Pensions on many occasions, to introduce a risk-based levy as soon as possible. We had opted for a different route towards that levy because of the practical problems that we had identified. I have not yet taken full cognizance of the decisions reached in the other place, but there is no disagreement between us on the need to move to a risk-based levy as soon as possible. I will examine the practical difficulties and seek to resolve those in accordance with the decisions made in the other place.

Vera Baird: Irrespective of longer-term measures, perhaps such as a citizen's pension, will my right hon. Friend consider some quick changes now to help those women who will soon retire to have better basic state pensions: for instance, scrapping the 25 per cent. rule, under which any national insurance contributions of less than 10 years do not count towards a pension at all? Does he agree that that is unfair, that all contributions should count equally, and that that change could be brought about without primary legislation and without adding complexities to the pension system? That could help women who are about to retire to have a larger basic state pension of their own.

Alan Johnson: I recognise the contribution that my hon. and learned Friend has made in this regard. I shall consider her suggestion, and other constructive suggestions made by Members. The report on women's pensions that we are pledged to publish next year will allow us to do that. The Turner commission included a separate chapter on women's pensions, which was a very good move on the part of the Pensions Commission.

Child Support Agency

James Plaskitt: When he expects to migrate existing Child Support Agency cases to the new maintenance assessment formula.

David Kidney: How many child support cases the Child Support Agency is dealing with under (a) the old rules and (b) the new system.

Chris Pond: The agency is working with EDS, the IT supplier, to resolve the problems with the computer system. We will make a decision on the transfer of old scheme cases once we are satisfied that the new scheme is working well. Currently around 326,000 cases are being dealt with under the new arrangements, with just over 1 million still subject to the old scheme.
	Despite difficulties of which the House is well aware, the agency is still collecting £280 million more in child maintenance than it did in 1997–98.

James Plaskitt: I thank my hon. Friend for his answer, but, as I am sure he is aware, it is broadly the same as the one that his Department has been giving since July 2003, when migration was supposed to start. It was supposed to be completed by April 2005.
	As more new cases come on stream and are assessed under the new formula, we are fast approaching a point at which we shall be running two CSAs in parallel. That is not sustainable. Whose fault is it, and when will it be put right?

Chris Pond: I acknowledge what my hon. Friend has said about the disappointment shared by all of us about the fact that we have not been able to make as much progress with the computer system as we wanted. That inevitably means that we cannot implement what all Members agree to be a much more effective system.
	I do not think that this is the place in which to allocate blame. My hon. Friend will know that we have had robust discussions with EDS. We are disappointed that the scheme is not in a fit state for us to be sure that it can work properly for parents with care and non-resident carers, but I assure my hon. Friend that we are doing all we can to make the system work effectively as soon as possible.

David Kidney: Will my hon. Friend take this opportunity to state publicly that the CSA's job would be easier if all parents, rather than just some, accepted their responsibility to maintain their children? Will he also acknowledge that running two systems side by side makes the agency's job difficult? Making one system out of the two would benefit not only parents and children, but CSA staff.

Chris Pond: My hon. Friend is right on both counts, but the most important point is that parents must take responsibility for the maintenance of their children. The CSA is there to ensure that that happens. If more non-resident parents took real responsibility, perhaps we would have less need for a CSA in any form. That could be described as a sad indictment.
	My hon. Friend is also right on the second count. Inevitably, running two systems at the same time makes the whole arrangement more complex. That is why we—like my hon. Friend, who has made an important contribution—are keen to ensure that the new system is working properly and effectively as soon as possible.

Steve Webb: The Minister will know that in the case of a lone parent on income support under the old child support system, any maintenance that is collected is deducted pound for pound. Under the new system, a lone parent can keep a tenner a week. That means that every week in which the Minister fails to get a grip on the issue, some of the poorest children in the land lose £10. As the new system was introduced 18 months ago, some of those poor families have lost more than £700 because of his failure to get a grip.
	Earlier this year, the former Secretary of State said that a recovery programme would be completed by the autumn. Did he mean this autumn, and has it been completed?

Chris Pond: The hon. Gentleman will know that 33,000 families already receive the child maintenance premium. We want to ensure that all who are entitled—and 600,000 children would benefit—receive that help as quickly as possible. My right hon. Friend the Secretary of State is looking afresh at this and a number of other issues to ensure that we can make that happen. There is a difficulty at the moment but the child maintenance premium is a feature of the new system. It cannot operate under the old system, the old system rules or the old system legislation. We are looking at the matter afresh to see whether there are any other mechanisms that we can use to ensure that the children who need the help get it.

Gregory Barker: I am glad that the Minister is not seeking to stand there and blame others for this Government shambles, but will he do what my constituents want him to do and accept ministerial responsibility for that shambles and give a definite deadline, which he will personally stand by, for when it will be cleared up?

Chris Pond: No, I will not be giving any deadlines because I, my colleagues and my right hon. Friend the Secretary of State have made it clear that we will make the transfer to the new system only when we believe that it can really deliver effectively for non-resident parents, for parents with care and, most important, for children. I have said openly to the House that we share the disappointment of other hon. Members that we have not been able to make those moves as quickly as we expected. The Secretary of State said clearly to the Select Committee that he would like us to be moving ahead more quickly, but we have to be honest that we have not made the progress that we wanted to make. It would be highly irresponsible to try to transfer the old cases across until we are sure that the system is working properly.

Jon Trickett: I accept that it is a complex computer problem and that having two systems is unsatisfactory but the human effects are disturbing. I have been writing to the Minister since April about Mrs. Voros from Crofton, who has lost all the money for her and for her child. That is surely an unsatisfactory situation. When can we anticipate justice for such people?

Chris Pond: My hon. Friend will understand that it is difficult to respond to individual cases on the Floor of the House. I can tell him, however, that we will certainly follow up cases in which constituents feel that the CSA is not providing an effective service. The CSA is committed to ensure that, as far as possible, the income from non-resident parents reaches the children who need that help as quickly and as effectively as possible. I will happily discuss with my hon. Friend the particular case that he has raised.

Paul Goodman: A key witness to a recent Select Committee on Work and Pensions inquiry claimed that poor planning by the Department was responsible for over 2,000 change requests being made to the new computer system. The Select Committee has said that it is "profoundly dissatisfied" with the Government's response to its report, which cited that claim and others.
	Will the Minister publish a full response to the Select Committee? If he does not, surely parents will conclude that the Department may have something to hide.

Chris Pond: If the Department were trying to hide something, I would not be standing at the Dispatch Box now—[Interruption.] Well, I could stand here, but I would not be saying that we accept and understand the frustration felt not only in the House but by parents because the system is not working as effectively as it should. We will certainly respond to the comments made by the Select Committee, which we believe is making a real contribution to the debate. I can promise hon. Members that the Committee will get a constructive response from the Department in which it will seek to deal with the issues that the Committee has raised.

Derek Wyatt: I have five constituents who moved from the old system to the new system, but now that the new system has failed they are on paper and pen systems. What they all want to know—all hon. Members are aware of similar problems—is when they will get their payment.

Chris Pond: I can only reiterate what I said earlier. Where the technological difficulties can be worked around on a clerical basis, the agency is committed to doing that. Like all of us, it wants to ensure that the payments get to the children. If my hon. Friend has particular cases that he would like to discuss directly with me, I will happily pursue those on his behalf.

Unclaimed Assets

Andrew Robathan: What recent assessment he has made of the possible use of unused orphan funds in bank and building society accounts to assist members of collapsed occupational pension schemes.

Peter Lilley: If he will use unclaimed assets to boost the funding of the financial assistance scheme.

Alan Johnson: I refer hon. and right hon. Members to the reply by my hon. Friend the Minister for Pensions on 4 July 2004. As my right hon. Friend the Chancellor made clear in the March Budget, we want as much as possible to reunite unclaimed assets with their rightful owners. Where the assets cannot be so reunited, they should be reinvested to benefit the whole of society. There are no plans to use such assets to provide assistance for people who have lost pensions.

Andrew Robathan: Apparently, there are some £15 billion-worth of unclaimed assets in dormant bank and building society accounts. As the Chancellor thinks that he can take the interest from such funds and give it to charities—which is sensible, assuming that the owners do not exist—will the Secretary of State not reconsider? Does he not realise that we all have constituents who have saved for all or part of their working lives yet, through no fault of their own, lost everything when their companies went bankrupt and their occupational pension schemes were lost? Is this not a good deserving case that the Minister should consider with some charity, for people in that desperate position?

Alan Johnson: We do not disagree about the problem faced by people who find their occupational pensions jeopardised, diluted or destroyed overnight. That is why we are introducing the pension protection fund and the financial assistance scheme. The hon. Gentleman is asking whether we should put the assets to which he referred into that scheme, and he mentioned a sum of £15 billion. That is disputed, particularly by the Building Societies Association, which summarised the problem when it described the policy of Her Majesty's official Opposition as follows:
	"This is an uncosted policy, as no thorough work has ever been undertaken as to the full amount held in lost accounts."
	To quote Adrian Coles, the director general of the BSA:
	"At no point have we been consulted by the Conservative Party about this policy. We dispute the figures involved. We also strongly question the right of any organisation, government or otherwise"—
	I think that the Conservative party falls under the description "otherwise"—
	"to take money from building society members. In addition, it is not clear under existing law whether this is even possible. But, most importantly, to promise pensioners compensation on the basis of an uncosted policy proposal is misleading and unfair."
	I completely agree with that statement.

Peter Lilley: I welcome the Secretary of State's decision to set up the financial assistance scheme, but does he not realise that it is untenable to do so on a basis that is not fully funded and does not cover all the potential victims of collapsed pension funds? Is it not therefore essential that he make use of the funds, rather than ridiculing the Chancellor's policy of making use of orphan funds for other purposes? If they are available for charity, they are available to the Secretary of State.

Alan Johnson: That is the last thing I was doing; I was quoting the Building Societies Association ridiculing the policy of the Opposition—

Peter Lilley: That is the same thing.

Alan Johnson: No, it is not. Government Members believe that, as my right hon. Friend the Chancellor said in this year's Budget speech, we should invest those moneys for the good of society as a whole. As for the money that we have available for the financial assistance scheme, for the reasons set out by my hon. Friend the Minister for Pensions in late June, we believe that we do have the opportunity to provide assistance. This is not compensation, and we do not accept any liability as a Government, but we are giving some assistance—not to the level that we are providing for the future, with the pension protection fund, but for the first time some help will be provided for those who have suffered in the past. The question is: should it come from the source that has been mentioned? We say no, it should not—and an awful lot of people who are politically neutral say the same thing.

Barry Sheerman: Does my right hon. Friend agree that we have been talking about orphan funds for a very long time? I thought that our Government—the new Labour Government—were supposed to be a radical Government. If they are, why do we not get on and do the research, knock some heads together, talk to the Treasury and get this sorted, whatever we use the funds for? Personally, I would like it to go to the pensioners who have lost their pensions, and I do not consider that to be a party political matter. But whatever we use the money for, let us get on with it, rather than sitting and talking about it.

Alan Johnson: I accept that my hon. Friend, who asks us to be radical, holds very strong views, and work is continuing. However, this is not a matter for my Department, and I suggest that he turn up at Treasury questions; indeed, as I understand it various opportunities are coming up to question Treasury Ministers on how far they have got. As Adrian Coles of the Building Societies Association pointed out, we are talking about other people's money, and for us to blunder in without giving the matter the most adroit and careful consideration would be a huge mistake. We are moving as quickly as we can in such a complex area.

Sandra Osborne: Surely the important point is that the Government have promised substantial help for those who have lost their pensions. However, my constituents are getting understandably impatient to find out exactly what assistance they will receive. What is the time scale for hearing more details about the pension assistance fund, and will my right hon. Friend meet my constituents to discuss this issue?

Alan Johnson: I certainly will. We are exactly on course with the statement made by my right hon. Friend my predecessor to Parliament in May, and we are on track in terms of the comprehensive statement made to Parliament on 30 June. Looking back year by year at the liabilities and assets of pension funds and schemes is another really complex issue. We said that by the end of November, we will be able to start consulting on the detail, and we are still on course to do so. We are also on course to have a scheme up and running by next spring, so when I meet my hon. Friend and her constituents I will be able to reassure them that that timetable is still on track.

Nigel Waterson: I will not be joining the Secretary of State in his unprovoked attack on the Chancellor, but what possible distinction can there be in principle or practice between using—with proper safeguards—unclaimed assets to assist charities, and using them to help people who have lost their pensions through no fault of their own? Can he see any reason at all in principle why people falling within his financial assistance scheme should not receive the same level of benefits as those covered by the PPF?

Alan Johnson: I find it amazing that the Conservatives are now saying how important this issue is, given that they voted against the Pensions Bill on Second Reading.

Nigel Waterson: indicated dissent.

Alan Johnson: The hon. Gentleman shakes his head, but it is a matter of record. [Interruption.] I am told from a sedentary position that they declined to give the Pensions Bill a Second Reading; I am sorry if that is hugely different from their saying that they refused to back it. The simple fact is that we believe that the orphan funds should be used for the good of society as a whole, and we will proceed very carefully in that direction. We believe that people who have lost money in pension schemes in the past should be given some level of assistance; however, we do not think it viable or sensible for us to promise the same level of assistance in future, through a pension protection fund that is set up to generate funds to ensure that it meets its liabilities. In looking at the past and offering assistance rather than compensation, we should be absolutely clear that the pension protection fund will not be able to offer 100 per cent. and 90 per cent. coverage in the same way.

Peter Pike: I have had several occupational pension schemes go wrong in my constituency, including Bellings' scheme, which was swindled by fraud in 1992. Will my right hon. Friend recognise that one of the biggest concerns of all those involved in such schemes is that when something goes wrong, the administrators, lawyers and legal people make so much money that the funds diminish and they do not get the pensions that they want? In fact, in some instances a bad position gradually gets worse.

Alan Johnson: I accept that that is a problem, and similar difficulties have arisen with schemes in my own constituency. Of course, some changes have already been made and importantly, schemes that start to wind up after 10 May 2004 will benefit from a change in the priority order. The sector as a whole needs to look at this issue, and the pension protection fund needs to examine the issue of how much money is being spent and is being   taken away from pensioners, rather than being dedicated to them.

Pension Credit

Anne McIntosh: What recent representations he has received on erroneous payments of pension credit.

Malcolm Wicks: From time to time, there are individual errors in the payment of pension credit, but overall accuracy is good. Pension credit payment accuracy levels were running to target at around 94 per cent. during August and September, for example. The Pension Service aspires to provide the best possible level of service and accuracy at all times.

Anne McIntosh: To what extent does the Minister attribute the erroneous contributions made to constituents in the Vale of York to the closure, after opening only two years ago, of the pensions office in York and its relocation to Dundee? What else can be attributed to the fact that he has unnecessarily chosen the most complicated formula, ensuring that he rewards only those who have failed to save throughout their working lives?

Malcolm Wicks: On the hon. Lady's final point, I am proud of the fact that, at long last, we have a system of assistance that rewards rather than penalises modest savings. Under the old system presided over by the Conservative Government, people were penalised pound for pound for any money they saved, so we are making progress on the savings incentive.
	On the question of erroneous payments, I do not think that we have been in correspondence about any particular problems in the Vale of York. If there has been correspondence, I apologise and undertake to look further into it. I am proud of the fact, however, that 3,000 pensioner households in the Vale of York are now receiving pension credit. I hope that the hon. Lady will also be pleased about that and will congratulate our excellent Pension Service on that result.

Iain Luke: The Minister will be aware of the unhappiness felt by many pensioners who lose their pension credit if they spend more than four weeks out of the country. They may have scrimped and saved to go abroad to meet other family members, for example, but on their return they are faced with bills to pay back their credit. Will the Minister take steps to extend the amount of time that pensioners are able to spend outside the country before they lose their pension credit? The period should be extended to help them.

Malcolm Wicks: Yes, we need to look further into that and, indeed, we are reviewing it. I am sympathetic to the point that my hon. Friend raises. Obviously, I will have to consider any resource implications. We also need to make it absolutely clear that this is not an exportable benefit, but one that exists for people who are resident in this country. As I say, we are looking very vigorously into that matter.

Archy Kirkwood: Does the Minister agree that one of the best ways of ensuring that pension credit payments are accurate is having a properly staffed and resourced local pension service? When the right hon. Member for Makerfield (Mr. McCartney) sold the idea of pension credit to the House, he strongly supported the idea of developing pension services locally. Can the Minister provide an assurance that despite the incidence of staff cuts, which the Government are working through, staffing levels for local pension services will be protected; otherwise, the erroneous payments will continue and get even worse?

Malcolm Wicks: We need to safeguard local pension services. It is a tough decision, but we are right to expect that, in future, we can run an efficient Pension Service with fewer staff. That is an important efficiency saving. However, at the local level, 638,000 home visits have been made and advice surgeries have seen 448,000 customers, so the local service is important and we will safeguard it.

Brian Jenkins: Has my hon. Friend conducted any satisfaction surveys of pensioners in receipt of pension credit, which would help us to understand what pensioners believe is the most appropriate way of assisting them?

Malcolm Wicks: Customer satisfaction surveys are running, if I remember correctly, at about 80 per cent.—a high level of satisfaction. We listen to all shades of opinion on the success of pension credit and the Pension Service, but I am sure the House would agree that we should listen most to our customers, who are satisfied. We are also satisfied, but not complacent. When we can improve matters, we will do so.

David Willetts: Those, of course, are the customers who have managed to get through the incredibly complicated procedure and managed finally to secure the pension credit. The figures do not include the 1.7 million pensioners who are not receiving the pension to which they are entitled.
	What would the Minister say to the pensioner who contacted the citizens advice bureau after applying for pension credit and receiving a letter from the Pension Service, which stated:
	"From 22 January 1811 you will get £163,168.66 a week"?
	Is not that absurd? Does it not show that a system as complicated as the one introduced by the Minister is prone to error, leads to high administration costs and fails to get help to the pensioners who really need it?

Malcolm Wicks: The pension credit is a great social advance, although in that individual case it was an advance too far. If the hon. Gentleman's accusation is that, in a system that deals with millions of people and pieces of information, we occasionally make mistakes, well yes, we do. However, I am proud of the fact that the customer satisfaction level is high. Indeed, it is much higher than the satisfaction level with the British Conservative party.

David Willetts: We are getting confused messages from the Government. The Secretary of State thinks out loud about the future of means-tested benefits. Indeed, I have not heard him defend means-testing and the pension credit in his new role at the Dispatch Box. Every time he appears, he offers some new criticism of the system that he is supposed to be defending. Now the Minister of State tries to maintain that the pension credit is a success. Does he really believe that the pension credit is the right long-term solution to Britain's pension crisis?

Malcolm Wicks: The right long-term solution is to ensure that more of our citizens in the future, including young workers today, retire on pension incomes above means-tested levels, through a combination of state pensions and private or occupational pensions. However, while there is a major problem of pensioner hardship and poverty, pension credit will have a significant role to play. As for the charge of complexity, under a previous Tory Government people had to fill in a very long form: the form is now shorter. Under a Tory   Government, people could not apply over the telephone: under a Labour Government, they can. Finally, under a Tory Government, the Pension Service did not exist and there were no home visits: our system makes it easy for the customer. I am proud of our record. I hope that he is ashamed of his.

Pension Service

Andrew Selous: If he will make a statement on the administration of the Pension Service.

Malcolm Wicks: The Pension Service is making good progress—as we have just heard—against its target of improving delivery to customers. I always appreciate a planted question at this stage. We made an announcement on 29 June about plans for business transformation to secure high levels of service with increased efficiency in the Pension Service as part of wider efficiency gains in the Department.

Andrew Selous: If the Pension Service is indeed making such good progress, perhaps the Minister can explain why one of my constituents had to receive seven letters from the Pension Service before it could organise direct payment into her bank account, the last letter being in Welsh. I am aware that the European Union managed to lose Wales from the map of the United Kingdom, but does the Department for Work and Pensions think that it has arrived in south Bedfordshire?

Malcolm Wicks: We are a joined-up Government and we always seek to improve language skills wherever possible. If one of the hon. Gentleman's constituents has received too many letters from us, I apologise. I would be grateful if he would let me have the details. However, this Government do not expect a single pensioner to live on £69 a week, as the Tories did. We have a guaranteed income of £105 for a single person. The vast majority of those entitled to the pension guarantee receive it. We are attacking pensioner poverty and I am proud of that: I hope that the hon. Gentleman is, too.

Rob Marris: I know that my hon. Friend is a keen follower of Wolverhampton Wanderers football club and will be aware that it seeks a new manager. Is he also aware that Jane Whitaker, the excellent and much more successful manager of the Pension Service in Wolverhampton, is also looking for a job because the DWP proposes to close the pension centre in the town? It has met and beaten its targets and has even taken in work from elsewhere in the UK, but the Department still proposes to close it. Will my hon. Friend reconsider that decision?

Malcolm Wicks: We do have in common the support of a certain football club and I am pleased to answer as an old-fashioned inside left. We need to make efficiency savings. If we are to convince the British public—as we will—that we can have a modern welfare state for the 21st century, it needs to be efficiently run. We needed to build up our staff to launch the pension credit successfully and we now need an efficient service. Wherever possible, we will redeploy people within the Department or elsewhere in government. We have had some success in that already and we will find other uses for pension centres that will not be required for the Pension Service in the future.

Patrick McLoughlin: If the civil servants operating the Pension Service have done such a marvellous job, should not the Minister move them to the Child Support Agency?

Malcolm Wicks: It is always useful to have some light relief. We are determined that all our public agencies should be run efficiently. That is true for the Pension Service and it must also be true for the Child Support Agency. We realise that a challenge faces the agency, and we must meet that challenge for the sake of lone mothers—and, indeed, some lone fathers—who are being let down by the other parent and who need that support for the sake of their children.

Incapacity Benefit

Paul Farrelly: How many people are claiming incapacity benefit in Newcastle-under-Lyme.

Maria Eagle: There are 4,500 people in Newcastle-under-Lyme claiming incapacity benefit. We are the first Government to try to help people on incapacity benefit who want to work to do so. We have already made progress, particularly through Jobcentre Plus, the new deals, and our flagship reform programme, pathways to work.

Paul Farrelly: I thank my hon. Friend for that reply. Is she aware that in constituencies such as mine a great number of people are on incapacity benefit due to the ravages of industries such as mining, pottery and steel? Clearly, in north Staffordshire we welcome the Government's support for programmes such as the job guarantee programme in Stoke, which is helping people off benefit and back into work, in line with pathways to work, but does she recognise that long-term claimants are deeply worried about the prospect of compulsory interviews? If those interviews are brought in, will she ensure that the Government show their sensitive side so that people are not dealt with in the same way as the many disability living allowance claimants who approach MPs for help week in, week out?

Maria Eagle: I will take up the DLA point with my hon. Friend on another occasion. I accept fully his opening point that there are higher levels of sickness and incapacity for occupational reasons in some areas, including his own. The pathways initiative is voluntary for long-term claimants. There is no compulsory element for those who have been on incapacity benefit for many years, many of whom, we find, volunteer to receive the help that the programme offers. We also find that compulsion is not an issue in practice. Most people who are concerned about the compulsory nature of the work-focused interview are reassured once they attend the first interview. Similarly, our condition management programme providers are not concerned about the impact that the compulsory element of attendance may have, especially in respect of mental health; nor are individuals who come to us, once they understand the nature of the process. I hope that I can reassure my hon. Friend that the compulsion element, which is supported by disability organisations countrywide, is not proving to be the concern that he fears.

Unemployment (Bulwell)

Graham Allen: If he will visit the Bulwell jobcentre to discuss trends in unemployment rates in the area.

Jane Kennedy: Regrettably, I am not planning on visiting Bulwell jobcentre in the near future, unlike my hon. Friend who visited it last week and took that opportunity to compliment the staff and congratulate them on achieving a regional performance award for their very hard and excellent work. However, I am pleased to say that as a result of our well-proven labour market policies, long-term unemployment in my hon. Friend's constituency has fallen by 69 per cent.

Graham Allen: I am not surprised that my right hon. Friend does not want to visit the Bulwell jobcentre in my constituency, because I have not wanted to visit it for nearly 18 months—even as an assiduous constituency Member of Parliament—whereas in 1997 I visited the office so often that I was invited to the leaving party for its then manager. Does not that prove to my hon. Friend what a brilliant success the new deal has been throughout the land? Will she make it clear that we intend not only to sustain the new deal, but to extend it wherever possible, to ensure that unemployment becomes an issue for all the right reasons, as it never was in the early days of the Government?

Jane Kennedy: I am grateful to my hon. Friend for those comments. He is right: the new deal programmes have been a well-proven success. More than 3,000 people have been helped into work through the new deal in Nottingham, North and more than 65,000 in the east midlands. Their lives have been changed through their experience of the new deal.

Progress2work Scheme

John Mann: How many progress2work clients have maintained full-time work for over 12 months since joining the scheme.

Jane Kennedy: Jobcentre Plus delivers progress2work, which helps those people who have misused illegal drugs to overcome difficult barriers to enter employment. I can tell my hon. Friend that more than 3,000 people with a history of drug misuse have been helped into work through the progress2work programme, and more than 1,000 of them are still in work after three months or more.

John Mann: That was not quite an answer to the question that I tabled today, and I look forward to receiving the actual answer. Does the Minister recognise that constituencies such as mine, which have a significant and successful drugs treatment programme, need the help of her Department to get people back to work? Is she prepared to meet a delegation of experts from my constituency who have prepared alternative plans on how to get people back to work because of the failures of progress2work?

Jane Kennedy: I am disappointed to hear my hon. Friend describe progress2work as a failure. In north Nottinghamshire, 85 per cent. of those people helped into work through progress2work are still in work more than three months later. His question relates to 12   months, and he knows from informal discussions that although we do not yet have evaluations for the one-year point, it is still a mark of success when individuals with the difficulties faced by those people who take part in the progress2work scheme are continuing to work after three months. Indeed, a 23-year-old man who had used heroin for six years and had been in prison for three month has now been off heroin for six months. He is on methadone, but he is working. He has achieved his driving licence and forklift licence to maintain work, and he is still in work after six months. That is one of the individual success stories that tell me that progress2work is having the expected results. However, I would be very pleased to meet my hon. Friend and his delegation to talk about this crucial issue.

Pathways to Work Pilots

Lynne Jones: What assessment he has made of the effectiveness of the pathways to work pilots; and if he will make a statement.

Maria Eagle: Pathways to work pilots are subject to ongoing evaluation. The early indications are extremely encouraging. As my right hon. friend the Secretary of State announced recently, pathways areas are getting double the level of improvement in the number of recorded job entries compared with other areas, and about six times as many people as in other places are taking up further help to get back to work.

Lynne Jones: I commend all those involved in the development of the programme, which I saw for myself on a visit to Derbyshire in the summer. The sooner that it operates in my constituency, the better. Does my hon. Friend agree that the holistic approach that the programme represents is far more likely to achieve long-term success than the punitive approach of threatening people with the loss of benefits? It is far more likely to be successful in getting people on incapacity benefit back into the world of work, particularly those who have mental health problems.

Maria Eagle: I understand my hon. Friend's point. I am glad that she was able to see pathways to work working in Derby, and I, too, hope that we can extend it to her constituency and other places as soon as possible. I know that she is chair of the all-party parliamentary group on mental health and understand her concern about the impact of compulsion, but I am a great supporter of compulsion in respect of the work-focused interview. There are safeguards to ensure that vulnerable people are not sanctioned if they do not turn up. It is absolutely crucial that people who have often been away from the jobs market and Jobcentre Plus for very many years get to see what kind of help can be offered. Many of them are surprised at the supportive way in which our staff can take them forward. Unless we get them in, we cannot help them get into work. So, the approach balances the rights of those individuals to be helped to get work with the responsibilities of having to turn up for the interviews.

Anne Begg: Although my local Jobcentre Plus has done a great deal to help disabled people into work, the extra help and the holistic approach mentioned by my hon. Friend the Member for Birmingham, Selly Oak (Lynne Jones) is not available, particularly in respect of the help that exists elsewhere through access to the rehabilitation service. Will my hon. Friend the Minister go further and say when pathways to work will be rolled out across the country, so that my constituents can benefit from the extra help that it provides?

Maria Eagle: Pathways to work is a pilot programme. Until very recently, no one knew how to assist that group of people to get back into the labour market. We need to ensure that we spend the money in the right way to get results. Therefore, despite the fact that the early indications are very encouraging—we are very excited about them—we do not yet know what the impact of the pilot schemes will be in respect of sustained job entries, for example. We need to ensure that we go forward on the basis of evidence. Only when we have that evidence—it is appearing all the time—will we be able to judge when and, indeed, if we can extend that approach elsewhere.

Faversham Jobcentre

Hugh Robertson: If he will make a statement on the future of Faversham jobcentre.

Jane Kennedy: The hon. Gentleman and I have discussed the future of Faversham jobcentre before. He knows that by 2006 we will have completed the roll-out of the Jobcentre Plus network and will be delivering radically improved services to all our customers. However, he knows, because I wrote to him on 3 November, that the existing jobcentre in Faversham is unfortunately not suitable for conversion to one of the new style offices, so we intend to provide our enhanced services from our Sittingbourne office, where many of our Faversham customers already go.

Hugh Robertson: I thank the Minister for her letter, if not the news that it contained. She will understand that the loss of the five days a week service and its replacement with one half day is causing a great deal of local anguish. Is there any way in which she can increase the number of days on which a face-to-face service is available? Will she assure me that no steps will be taken to close Faversham jobcentre before the new service at Sittingbourne is up and running?

Jane Kennedy: I will look at the detail again. However, the hon. Gentleman knows that there are only 620 claimants in his constituency, which is down 60 per cent. on the figure in 1997. Jobcentre Plus is not about only new offices. He rightly asks whether we can ensure that the new way in which services will be delivered will be sufficient to address the requirements placed upon them. I will look into the matter that he raised today. We will offer services outside jobcentres in such places as local surgeries and shared sites with local authorities to meet the needs of our local customers. I will look again at the number of days on which services will be available in Faversham.

Child Support Agency

Adrian Bailey: What assessment he has made of the new Child Support Agency calculation scheme for maintenance payments; and if he will make a statement.

Chris Pond: I was anxious that I might not get a further opportunity this afternoon to get to the Dispatch Box to talk about the Child Support Agency.
	My right hon. Friend the Secretary of State has made regular progress reports to the House, the latest being on 28 October. More than 230,000 cases have been cleared under the new arrangements and more than 33,000 of the poorest families are benefiting from the new child maintenance premium. Customers and staff confirm that when it works well, they like the simplicity of the new scheme.

Adrian Bailey: I thank my hon. Friend for his reply. One of the results of the welcome simplification and transparency of the new scheme is that parents who are paying under the old scheme can access the website to calculate what their payments would be under the new scheme. However, they then of course find that they will not graduate on to the new scheme until some date in the future that is yet to be determined. Will he reassure my constituents and me that they will graduate at the earliest possible opportunity?

Chris Pond: Of course we understand that the new scheme's transparency is attractive, which is why the whole House wants us to move towards it as quickly as possible. I understand that parents who want to move on to the new scheme quickly are frustrated because they do not know the date on which that will happen. If one parent is anxious to move on to the new scheme, it probably means that the other parent will lose significantly. However, I must make it clear that even after we have made the decision to move across to the new scheme, phasing arrangements will apply, which will mean that people will not move immediately on to new assessments. I reassure my hon. Friend that we will move on to the new scheme as soon as possible after we are sure that the new system is working properly.

Robert Smith: That answer will not help people who are trying to work out what will happen to them. Our constituents need to plan their lives and finances. Can the Minister give them any idea of what "as soon as practically possible" means? What sort of phasing time scale does he expect to apply? Has he worked out at least the phasing part so that our constituents can understand how long the phasing will last?

Chris Pond: Yes—the phasing arrangements are already well publicised. We reckon that 80 per cent. of cases, even with phasing, will move on to the new assessment within three years, although the change will take up to five years for others. That process is designed to ensure that people will not face large changes to their liabilities or assessments, but, again, I am afraid that I cannot give the hon. Gentleman or the House a clear date on which we will be able to begin the process. I wish that I could.

Russell Brown: It is a tremendous achievement when the CSA secures the information to carry out the assessment. It is an even greater achievement when the non-resident parent makes the payments. The ex-partner of one of my constituents has been making payments to the CSA since June, yet she has not received a single penny. If I pass information on that case on to my hon. Friend, will he endeavour to secure the release of those funds at the earliest opportunity?

Chris Pond: The agency is committed to passing on those payments as quickly as possible so that the children for whom they are intended get that help as soon as possible. There may be circumstances in which it cannot pass them on, sometimes because it does not have sufficient information on the intended recipient of the payment or it is waiting for clearance from bank accounts. However, I assure my hon. Friend that if he brings that case to me, I shall look at it carefully.

EU Summit

Tony Blair: With permission, Mr. Speaker, I shall make a statement on the European Council that took place in Brussels on 4 and 5 November.
	I should like to thank Prime Minister Balkenende and the Dutch Government for their arrangements for the summit, and for the way in which they have conducted their presidency to date. The Council was inevitably dominated by Iraq, given the presence of Dr. Allawi, the Iraqi Prime Minister.
	First, let me express what I know will be the sentiments of the entire House in sending our profound condolences to the families of the Black Watch soldiers killed by a terrorist bomb in Iraq last week and our sympathy to those soldiers injured yesterday in another   terrorist attack. We salute their dedication, professionalism and, above all, sheer and undaunted courage. They are an example to us all and we can and should be very proud of them.
	Let us also be very clear about the fundamental importance to Britain's security of what the Black Watch and, indeed, the British armed forces in the south of Iraq are doing. Defeat of terrorism in Iraq is defeat for this new and virulent form of global terrorism everywhere. A democratic Iraq is the last thing the terrorists want to see. It is precisely for that reason—because victory for the terrorists would damage security around the world, including here in Britain—that we have to hold firm, be resolute and see this through, including in Falluja.
	The action by allied and Iraqi forces under way in Falluja would cease now, immediately, if the terrorists and insurgents who are using Falluja as a base for terrorism laid down their weapons and agreed to participate in the elections. Over the past few months, as he explained today, Prime Minister Allawi has tried to persuade them to do so. They have refused, not because they are fighting a foreign occupation—if the terrorism stopped, American, British and other troops would leave Iraq—but because they are fighting democracy. They are fighting to stop democratic elections, supervised by the UN and due to take place in January. They know that while Falluja remains outside the control of the UN-endorsed Government, they can use it to wreck elections. Why do the terrorists fear elections? Because they know that given the chance to vote for their own Government, Iraqis would reject the extremism and fanaticism these terrorists represent.
	The powerful speech made by Dr. Allawi to the European Council made precisely those points. He appealed for Europe's help. Some promised support of a military nature; others promised only financial support. But all of the Council agreed that it was in the interests of global security for Iraqi elections to take place. The Council also agreed a comprehensive package of EU assistance for Iraq, including a further programme of financial and logistical support for the elections, and financing for the UN protection force. This is on top of €300 million of humanitarian and reconstruction support from the EU over the past two years.
	Following the re-election of President Bush, the Council also agreed that a close transatlantic partnership was fundamental to building international peace, security and prosperity, and that we now need to strengthen that alliance so that we can intensify our work together in addressing the main international threats and challenges of the moment, including regional conflicts, terrorism and the proliferation of weapons of mass destruction.
	The Council also heard a presentation from the former Prime Minister of the Netherlands, Wim Kok, on his mid-term review of the Lisbon strategy on European economic competitiveness. He rightly concluded that Europe has to do far more to improve its underlying economic performance if it is to respond to the challenges of Asia and the United States, and he sensibly highlighted the importance of completing the single market, developing flexible labour markets, and promoting sustainable growth. The Council adopted a new five-year work programme of measures in the area of justice and home affairs. There are great benefits for the UK in co-operation with our European partners on these issues. Illegal immigration affects all member states. However, the opt-in protocol for Britain—[Interruption.]

Mr. Speaker: Order. Mr. Bellingham, you had better be quiet, otherwise I will put you out of the Chamber.

Tony Blair: The opt-in protocol for Britain, negotiated in Amsterdam in 1997, remains. It is also enshrined in the new constitutional treaty. We have used it successfully over the past five years to opt in to new measures on asylum and combating illegal immigration, and to opt out of measures on legal migration, frontiers and visas. The protocol gives us the right to decide whether to participate in each item of the EU work programme and makes nonsense of claims that Britain has given up the right to control its own borders. If, of course, we opt in because we want a particular measure, it is in our interests that in a Europe of 25 and soon 27 or 28 countries the use of a veto by another country cannot block the measure.
	Finally, the President-designate of the Commission, José Manuel Barroso, briefed us on his proposals for restructuring the new Commission. He has reacted decisively to resolve the dispute with the European Parliament, and I am confident that as a result the new Commission will be able to take office soon. In summary, the meeting once again underlined the importance to Britain of maintaining both a strong relationship with the United States of America and a strong place in the Councils of the European Union. Both partnerships are vital to the British national interest and it will remain the policy of this Government at least to nurture both.

Michael Howard: I join the Prime Minister in expressing our deepest sympathy to the families of the soldiers of the Black Watch who have lost their lives and our good wishes for a speedy recovery to those who have been injured. I join, too, in the tribute that the Prime Minister paid to the outstanding dedication, professionalism and courage of the Black Watch.
	I welcome both the European Council's discussions with Prime Minister Allawi and the financial contribution towards elections in Iraq. I support everything that the Prime Minister said about the importance of defeating terrorism in Iraq and elsewhere. Events in Samarra have shown that bringing an area under ostensible control does not, sadly, always mean an end to insurgency. Can the Prime Minister tell the House as much as he can about the coalition's plans to deal with the situation that is likely to arise in Iraq after the battle for Falluja?
	I welcome the Council's agreement on the importance of a close transatlantic partnership and on the need to strengthen the alliance. What specific proposals does the   Prime Minister have to bring that about? The communiqué emphasises the middle east peace process, although his statement was silent on the subject. Is it not time to turn again to the road map? Should we not now seize the moment to make real progress on the ground towards a secure Israel within internationally recognised borders and a viable Palestinian state?
	The European Council also discussed Iran's nuclear programme. Has preliminary agreement been reached on that issue with Iran? In the past, Iran has not complied with the undertakings that it has given, so what measures are proposed to make sure that it does so this time? The communiqué also expresses grave concern about Darfur. Has not the time come for immediate United Nations action, including automatic sanctions, to ensure that the Sudanese Government reign in the militias? Should not the African Union forces be given the mission to keep the peace, rather than just monitor the situation, to put an end to the dreadful attacks on civilians that still continue in that area?
	The Prime Minister has boasted endlessly about progress on economic reform in Europe. In 1998, he said
	"We have to reform Europe and we are winning that battle".
	In 2000, he said that there had been
	"a sea change in European economic thinking . . . away from heavy-handed intervention and regulation, towards a new approach based on enterprise, innovation and competition."—[Official Report, 27 March 2000; Vol. 347, c. 21.]
	But is not that all talk? Has not Romano Prodi admitted that economic reform in Europe has been a "big failure"? Has not the director general of the CBI said that Europe has got to change? Has not Wim Kok said that
	"too many targets will be seriously missed"?
	The aim of the Lisbon agenda was to make Europe the most dynamic economy in the world by 2010. Is not that just a pipe dream? Will not we all pay the price in terms of lower productivity, lower living standards and fewer jobs?
	Promises on economic reform are not the only areas where the Prime Minister has been all talk. Four years ago, he said that he did not want a
	"single, legally binding document called a Constitution"
	yet that is exactly what he signed a week ago. The director general of the CBI has said that the constitution will not help business. The Prime Minister's own former chief economic adviser has said that it will
	"entrench Europe's economic failings and drag Britain down too".
	[Interruption.] Well, this was someone to whom the Prime Minister listened for six and a half years, so I think that his views might be entitled to a modicum of respect. Is not it the case that the constitution will make Europe's economy even less flexible, even less competitive and even more sluggish than it is today?
	Earlier this year, the Prime Minister promised that
	"we will retain completely our control over our asylum policy".
	But was not that promise all talk? At the summit, a "common European asylum system" was agreed. The communiqué that the Prime Minister signed says:
	"the Constitutional Treaty greatly increases the powers of the European Court of Justice in that area".
	Does not that mean in plain English that more and more decisions on asylum and immigration will no longer be taken in this elected Parliament, but will in future be taken by the unelected judges of the European Court? It is no good the Prime Minister's talking about opt-outs when he has chosen to opt into all the major measures on asylum.
	Is not all this a huge lost opportunity? Are not there practical policies that would turn some of the Prime Minister's rhetoric into action? If the Prime Minister means what he says about listening to people on Europe, why will not he match our pledge to set a date next year for the referendum on the constitution so that the people can have their say? If he means what he says about a modern Europe, why does not he put the case for greater flexibility, including the return of powers from Brussels to Britain so that we are no longer forced to accept so many new regulations that we do not support?
	In 1997, the Prime Minister promised to
	"lead a campaign for reform in Europe".
	Seven and a half years later, in a diverse Union of 25, and in a fiercely competitive world, is not the need for a modern, flexible, reformed European Union more urgent than ever and under this Prime Minister, despite all his talk, are not we further away from it than we have ever been before?

Tony Blair: First, let me deal with the questions on Iraq. In respect of Samarra, Najaf, Tal Afar and other places that have been taken back into the control of the Iraqi Government and Iraqi forces, it is of course true that terrorists will carry on actions in those places, as they did in Samarra just a few days ago.
	There are a couple of interesting points, however. When those terrorists have been cleared out of these cities, it has become very obvious, contrary to what we were told beforehand, that they did not enjoy the support of local people; on the contrary, local people were all too glad to get rid of them so that they could get back to the lives that they wanted to lead.
	Let us be clear that the purpose of the action in Falluja is to stop it being used as a base for terrorists and insurgents who are killing innocent people in Iraq and anybody who tries to make the country better. If and when we take back control of Falluja so that it is in the control of the Iraqi Government, a process of reconstruction will follow, as happened in Samarra and Najaf, where literally hundreds of millions of dollars are being spent on reconstruction projects. The people can then participate fully in the elections. I do not minimise the difficulties but it is essential for the holding of democratic, free and fair elections that the power and grip of the terrorists and insurgents in some parts of Iraq be broken. That is why Prime Minister Allawi has authorised the operations.
	It is extremely important that we make progress on the middle east now. Progress must be towards a two-state solution; an Israel confident about its security and a viable, independent Palestinian state. It is essential to take measures to make progress on that. I hope that we shall do that as soon as possible. As I said when I congratulated President Bush on his re-election, it is the single most pressing political challenge of the moment.
	We are still at the point of negotiation on Iran. A series of issues has been agreed at political director level, but not yet at intergovernmental level between the European three—France, Germany and the United Kingdom—and the Iranian Government but we are hopeful that we will be able to make some progress in the next few days.
	On Sudan, it is important to make it clear that not only the Sudanese Government should exercise restraint; some of the Sudanese rebel groups must do so. A series of measures has been laid down for the Sudanese Government and they must follow them. If they do not, there has to be reference to the Security Council and necessary measures must be taken.
	I agree with the right hon. and learned Member for Folkestone and Hythe (Mr. Howard) that the African Union should not only increase the number of troops available there but make it clear that, if possible, it can keep the peace as well as monitor what is happening there. However, it is a difficult and delicate situation for the troops that are going into it. We are watching the situation carefully. My right hon. Friends the Foreign Secretary and the Secretary of State for International Development are in constant touch with their opposite numbers in other capitals and with the Sudanese Government. However, the situation remains serious. If anything, it has got worse rather than better in the past few weeks. If we do not get obedience and compliance with the measures that the international community laid down, we will have to revert to the matter at Security Council level and take action.
	It is worth pointing out that, since 1999, some 6   million jobs have been created in Europe and liberalisation has taken place in many sectors under the Lisbon strategy process. I agree that it is important that we do more but the right hon. and learned Gentleman's policy of being a semi-marginalised player in Europe will not help to get economic reform. As for the woeful things that he claims will happen if the EU constitution is passed, I merely point out that he used to make the same predictions when he was Secretary of State for Employment in the previous Government about the social chapter. I think I remember his saying that 500,000 jobs would desert Britain if we signed the social chapter. We signed it and 2 million extra jobs have been created since. His powers of prediction are not good.
	I am surprised that the right hon. and learned Gentleman opposes our opt-in on asylum. A few months ago, he made a speech in which he said that a process whereby countries decided whether to opt in to specific measures was precisely the direction in which Europe wanted to go. We have delivered that, but the moment that we do so, he switches around 180°, in his usual opportunistic fashion, and says that it is a disaster for the country.
	The right hon. and learned Gentleman mentioned the charter of rights. Let me read part of our protocol to him. It states:
	"No decision of the Court of Justice interpreting any such provision"—
	to do with asylum and immigration—
	"shall be binding upon or applicable in the United Kingdom."
	That destroys the effect of the right hon. and learned Gentleman's point. As for his view that we should have a bold strategy of renegotiating the existing membership of the European Union, it is, as some his hon. Friends have pointed out, simply not on the table. He would have to get the agreement of every one of the other members to renegotiate that. How many members have agreed? [Hon. Members: "Norway."] I think we are back to the Norway issue.
	Following the right hon. and learned Gentleman's comments at the weekend, it is extraordinary that, in his first year as Conservative leader, he has managed to achieve a foreign policy position that would make us a marginalised member of the European Union and not welcome in the White House either. Only his leadership could have brought the Conservative conception of foreign policy to such a pass.

Charles Kennedy: I thank the Prime Minister for his statement. May I join him, on behalf of my right hon. and hon. Friends, in extending our condolences to the families of the Black Watch personnel who have been killed or injured, as well as to those of the very brave civilians who are giving their support and assistance to the Black Watch in their extremely dangerous job? The families not only of serving Black Watch personnel but of the Scots Guards, who have reportedly been placed on replacement standby, would welcome some clarification of the Government's position on possible replacement forces, given that they are clearly adhering to their view that the Black Watch will be home by Christmas. The House and the families concerned would welcome any clarification that the Prime Minister can give them on that issue, not least because there were contradictory reports in the media this weekend on whether replacement forces would be deployed at the end of this period.
	Whatever the original principled disagreements over the basis for the war, and, indeed, the more recent divergences of view over what many of us regarded as a strategic political and military shift over the Black Watch deployment, there is obviously consensus on wanting to see the democratic timetable and an independent Iraq achieved, and on our having no truck with terrorism. I am sure that the Prime Minister will acknowledge, however, that the real concerns over this American-led assault on Falluja—not least in terms of the civilian casualties involved—give rise to fair and legitimate questions. These questions have been raised on the international stage by Kofi Annan, the Secretary-General of the United Nations, and they are also arising within the Iraqi interim Government, not least in the different viewpoints now being expressed by the Prime Minister and the President there.
	Does the Prime Minister agree that, whatever the events of the next few days and weeks in Falluja, it is essential that the Americans' conduct does not squander any moral capital or undermine the legitimacy of the democratic process, especially if that were to result in a Sunni boycott of any elections taking place in January? On a practical as well as moral level, will the Prime Minister address the question of what contingency plans have been put in place to deal with those insurgents who have already fled Falluja, or who will in due course be flushed out of the city and move to other parts of the country, perhaps to carry on their notorious activities there? Formal hostilities in Falluja are commencing as we speak, so I am sure that the Prime Minister will acknowledge that these are responsible questions to which the House will genuinely want to return in due course.
	On the allied issue of Iran, the Prime Minister has already responded to some of the discussions that have taken place. He has an important summit meeting coming up later this week with President Bush, which is surely welcome, given the agenda that will be in front of them. If, as he suggested a moment ago, further discussions among the three European powers—the United Kingdom, France and Germany—will be taking place over the next few days, is he hopeful that he will be in a position to ask the President to endorse the strategy of these three countries in regard to Iran later this week in Washington? On completion of that summit meeting, does he intend to return to the House with a further statement of this kind, perhaps this time next week, to enable further discussions to take place?
	On the issue of the eventual composition of the European Commission, does the Prime Minister agree that the way in which the European Parliament, as the directly elected representative body of all the member states, was able to have an impact on the President of the Commission should encourage one and all of a Eurosceptic disposition or otherwise that it is the proper forum in which proper European parliamentary pressure can be exerted to achieve a healthier, more desirable outcome? Does he also agree that this recent crisis, so-called, in fact redoubles the argument for a smaller Commission—ultimately—of precisely the type that the constitution puts forward?
	Finally, on the issue of the constitution and the referendum pertaining to it, the Prime Minister has said that it is the Government's position that there should be a referendum in due course. Will he confirm that the Government, irrespective of what might happen in referendums that may precede one here, will proceed with a referendum, come what may, in this country? If the type of economic liberalism and greater economic flexibility, to which he alluded in his statement and which were discussed at the summit, are achieved, will he perhaps, on a future occasion, see scope for doubling up a referendum on the constitution with one on the single currency?

Tony Blair: First, in respect of Iraq, let me say that although we had a disagreement about the war, I accept entirely that the questions the right hon. Gentleman is asking are perfectly legitimate ones to ask in this connection. I have made it clear that the Black Watch deployment will be finished so that the Black Watch is back in time for Christmas. It is not anticipated that the Scots Guards will replace the Black Watch in the job that it is doing at the present time.
	I also entirely agree that the important thing is to ensure that the democratic elections in Iraq go ahead. As I think we saw with Afghanistan, what happens in the course of the movement towards democracy is that some of those people who were anti-democratic forces end up on the defensive because people can see that there is a democratic process they can take part in. The power of some warlords in Afghanistan was broken not in the two years after the invasion, but in the few months running up to the democratic elections.
	The decision in respect of Falluja was taken by the Iraqi Government. It is really important that people understand this. Prime Minister Allawi made it very clear when he was appointed by the United Nations—endorsed by the United Nations—back in June that decisions of this nature were for him. Anyone who heard his press conference today, including his description of exactly how those terrorists and insurgents are using hospitals, schools, mosques and other places to store explosives and to try to ensure that in removing them there is the maximum damage done, could hear from his statement how passionately he believes that this is important. I understand that the decision has also been endorsed by the National Assembly. The very fear that he and others have is that if these terrorists and insurgents are allowed to carry on effectively making no-go areas in Iraq for the Iraqi Government, the issue of elections will be made more difficult.
	That brings me to the UN and the Secretary-General's letter. He said in that letter that the Iraqi elections are what he called, I think, the keystone of progress in Iraq. That is true. It is true also that he went on to express reservations about the action in Falluja, but as Prime Minister Allawi says, without the action in Falluja the keystone of the democratic process may be at risk. That is the important reason for doing it.
	I think the Secretary-General is right also in saying it is important that we retain the moral high ground in fighting for elections in Iraq, but I say this to him and to others: part of us doing that is to keep emphasising the whole time to people that if the terrorists and insurgents would stop, elections would go forward. There would be full participation by Sunnis and others in those elections. Everyone wants that to happen. If the terrorism and insurgency stopped, there would be no need for American and British and other countries' troops to help the Iraqi forces before they are able to look after Iraq on their own.
	The truth of the matter is that it is the terrorism that keeps troops from America, Britain and elsewhere there. If it stopped, of course, the Iraqi Government would be able to assume control of those areas, the UN-sponsored elections would take place and we would have a democratically elected Government. That is why I say to people that the absolutely critical argument to understand is that these terrorists are not fighting foreign troops because of their presence—they are fighting them because they are an obstacle to preventing democratic elections. They know that if democratic elections happen, people will never give up democracy.
	In Afghanistan, turnout was highest among women, and highest in the areas where the Taliban used to hold sway. It is obvious from the past few weeks, I am afraid, that the terrorists have an increasingly sophisticated strategy, in relation to how they operate, what they say and how they play the modern media. They are trying to ensure that they focus attention not on their attempt to prevent democracy but on the presence of foreign forces in Iraq, when they know perfectly well that those forces would leave if only the terrorism stopped.
	In respect of Iran, the Americans, France, Germany and the UK take the same line: we have all made it clear that it is not acceptable for Iran to acquire nuclear weapons capability. It should come into compliance with the International Atomic Energy Agency. We are trying to put maximum pressure on it to do that. I am sure that the right hon. Gentleman would endorse that strategy, which we all endorse.
	In respect of the European Parliament, I sort of agree with what the right hon. Gentleman says. In respect of a smaller Commission, I entirely agree with what he says—in time, I think that that is important. We have made it clear that we will have a referendum on the EU constitution. As for combining that with one on the euro, we have always made it clear that membership of the single currency must be decided on the basis of the economic tests, and that remains the case.

Gerald Kaufman: Was it not churlish of the Prime Minister not to congratulate the Leader of the Opposition on his first anniversary as leader, since the right hon. and learned Gentleman will not be around to celebrate a second anniversary?

Mr. Speaker: Order. The right hon. Gentleman is out of order. I call Sir Stuart Bell.

Stuart Bell: I am grateful, Mr. Speaker, for the opportunity of answering a question on behalf of the Prime Minister.
	However, the Prime Minister, in his statement, referred to our strong relationship with the United States and our strong place in the European Union's Councils. He said that that was Government policy and that it was in our national interest, but were there not siren voices in the Council indicating that competition between the European Union and the United States was a better policy than competition and collaboration? Will he not reiterate that that transatlantic co-operation and closeness to which he referred should also be the policy of the entire European Union?

Tony Blair: Obviously, I agree with my hon. Friend. In so far as there are any voices saying that Europe should try to set up a rival pole of power to the United States, I think that it is far better that we co-operate strongly together. Of course, that is another reason why it is important for Britain to stay part of the European Union and a key player in Europe. It cannot be stressed too often that many countries around the table in Europe—let us remember that 12 out of the 25 have troops in Iraq—are strong supporters of the transatlantic alliance and need Britain arguing that case with them.

Peter Tapsell: Will the Prime Minister now answer the core argument in the letter of the Secretary-General of the United Nations, which is that an attack on Sunni-held Falluja by mainly Shi'a militia, under cover of American firepower, far from making it more likely that there will be peaceful elections there in January, will prove dangerously divisive for the future social and political unity of Iraq?

Tony Blair: That is simply not the case. It is not the Sunni-held town of Falluja: the town is held hostage by terrorists and insurgents. If they stopped and laid down their weapons, that town would have its own municipal democratic elections, and the town as a whole could participate in the Iraqi elections. Surely what the hon. Gentleman and every democrat should say is, "There is no need to fight; if you believe in what you are doing, stand in the elections." What Prime Minister Allawi would say to him is that the very purpose of the terrorists, many of whom are not Iraqi, never mind from Falluja, is to stop the democratic process. Surely all of us who are democrats, whatever we think about the war, should agree with the Iraqi Government.

Helen Jackson: Many of us feel that since the American elections there is an even greater need for very close integration with Europeans on our foreign policy. Was my right hon. Friend able to secure the full backing of European Union partners for our aid and development programme, and particularly our concentration on Africa, for when we hold the presidency—we hope—of both the European Union and the G8 next year?

Tony Blair: My hon. Friend is right to say that aid and development are an important element of our partnership in the European Union. I believe that there is wholehearted support for that, and I also believe that there is support for it in the United States of America. It is important, therefore, for us to use not just the EU presidency but the G8 presidency to further that agenda. As my hon. Friend will know, we have selected climate change and Africa as the two key subjects for our G8 presidency.

Teddy Taylor: Given widespread concern about the appalling situation in Iraq extending and not being contained, will the Prime Minister and the European Council make it abundantly clear that we are wholly opposed to the bombing or invasion of Iran by America, Israel or anyone else? Will he seek to remind his friend President Bush that it is only a few years since the Americans were supporting, and providing weapons of mass destruction for, their then friend Saddam Hussein so that he could invade Iran?

Tony Blair: No one is talking about an invasion of Iran. No one has ever talked about it, to my knowledge. I think it is completely absurd of us to talk in this way. However, it is obviously important for Iran to face up to its obligations under the International Atomic Energy Agency. It should also be recognised that our reasons for taking action against Saddam Hussein—going back over 12 or 13 years—were his invasion of Kuwait, his defiance of United Nations resolutions, and the plain intent that he had to develop weapons that cause immense damage not just to the middle east but to the wider world.

Dennis Skinner: Is the Prime Minister aware that, now that we have these statements on European summits, no one—with the exception of the leader of the Liberal Democrats—seems to care about the euro or the single currency any more? Are there any long faces when he meets these people? There has been all this talk about our having to join. Seven and a half years have elapsed, and we have kept our promise. I hope everyone understands that. Will the Prime Minister tell them that, at least until the next election, we will not have anything to do with it, and will leave the Liberal Democrats to play with their own little toys?

Tony Blair: I will not put it exactly like that, but my hon. Friend makes an important point. For years we have been told, particularly by the Conservatives, that our ability to decide whether we want to join the single currency will somehow be taken away by Europe. The fact is that we have that right—we have it absolutely—and we have made it clear that in the end it is a decision for the British people.

William Cash: The Prime Minister referred to Wim Kok and his indictment of the way in which Europe has been going. He has also referred to the CBI. He will know that today the president of the CBI issued a similar indictment. He also knows that David Arculus, the head of his own Better Regulation Task Force, has said that this is costing £100 billion a year in over-regulation, much of which emanates from the EU. Does he accept that in the past seven years he and his Government have agreed to a large number of those regulations? Does he also accept that he can therefore do something about it? He can use the powers of this legislative Chamber—this House of Commons—in the interests of British business, which is becoming increasingly angry, to repeal or amend any of the legislation that is having such an impact on British business.

Tony Blair: Let me make two points. First, I do not think the director-general of the CBI would agree with the hon. Gentleman's views on Europe, whatever he says about European regulation.

William Cash: It was the president.

Tony Blair: Or indeed the president, for that matter.
	Secondly, of course, regulation has been agreed by this Government in the European Union and indeed by the previous Government in the European Union, which I know was not much to the hon. Gentleman's liking either, but it is important to recognise that the only way that we can get Europe to take a better and more sensible view of regulation is to be in there and to be part of it. The alternative is to get out of Europe altogether. I think that he probably would favour that in the end, but it would not be in the interests of British business and British jobs. I do not think that the CBI would opt for that either.

Keith Vaz: Does not my right hon. Friend agree that the importance of the Lisbon agenda is that, for the first time, it set out benchmarks for economic reform in the EU? The purpose of the Kok report was, rightly, to praise countries such as Britain that have risen to the challenge of economic reform and to criticise others that have failed to do so. It is an opportunity to ensure that those who have not moved forward will do so by the time of the mid-term review next spring and indeed during our presidency.

Tony Blair: That is absolutely right. It is worth pointing out that it is not simply Britain that has undertaken economic reform but Spain, Denmark, Holland and other countries. A huge reform programme is under way in Germany, tackling really difficult issues. The purpose of the Wim Kok report was to say not that everything in Europe is hopeless but that, on the contrary, there was a certain amount of progress but there needed to be much more.

Simon Thomas: As the Prime Minister set out tackling climate change as one of his key international objectives for next year in the G8 and in the EU presidency, can he say what progress was made at the summit on that subject? In particular, can he take the opportunity to defend the reputation of his chief scientific adviser, Sir David King, against the attacks on him last week by the adviser to President Bush on climate change?

Tony Blair: I am not sure that the person who made the attacks is an adviser to President Bush, still less a member of the US Administration, but obviously I entirely agree with David King's position on climate change. He is absolutely right. We did not discuss it at the European Council, but the European Union would be broadly supportive of that position. It is important that we try to begin a dialogue with the US, very much based on science and technology, as to how to deal with greenhouse gas emissions in the years to come. I hope that we can take forward that agenda.

Alice Mahon: If, after another brutal bombardment of Falluja, the Sunni Muslims refuse to participate in the elections, what strategy will the ever decreasing coalition employ to bring democracy and security to Iraq? Will it be bomb a city a month until all that is left in Iraq is rubble and hatred?

Tony Blair: No, the strategy is very clear: it is to say that, instead of the government of Iraq and Iraqi towns being decided by terrorists who plant car bombs, kill innocent people and kill contractors who are trying to make the country better, there should be a democratic process in which people stand for election both locally and nationally and get elected on the basis of the ballot box. I cannot understand why people cannot agree with that.
	In respect of the figure of 100,000 that has been bandied about as the number of people who have died in Iraq over the past period, I saw today, looking at the figures in greater detail, that the figure is extrapolated from the recorded deaths of 61 people. When one sees that, one can understand how much propaganda is coming through on the issue.

Peter Lilley: Does the Prime Minister accept that what he has signed up to on immigration is a ratchet mechanism for the one-way transfer of power on making immigration policy away from this country to the supranational authorities in Europe? Can he confirm that, whenever the Government opt in, as he puts it, to immigration measures taken under that procedure, if circumstances subsequently change, or the European Court interprets those measures in ways that we do not anticipate, we will be unable to amend them, or to withdraw from them?

Tony Blair: The simple position is that we are entitled to decide whether we opt in to any of these measures. That is the pick and choose Europe, if you like, that I thought the right hon. Gentleman and others supported. It is precisely what we are able to do. Indeed, it is more than that: if at the end of the process we decide not to opt in when the measure is first discussed, after that discussion, we can also decide to opt in.
	Of course, once we opt in, we are part of that process. [Hon. Members: "Ah!"] But it is our complete choice as to whether to opt in; we might as well say that about any measure in Europe. I thought that the whole point was that the Conservative party wanted a situation in which, when measures were discussed, we had the decision whether to opt in or not. This gives us that decision. Obviously, once we opt in, that is presumably because we have decided that it is in our interests to do so. Only the Conservative party could say that a decision whether to opt in is somehow a negation of our sovereignty; surely it is the expression of it.

Eric Joyce: Does my right hon. Friend agree that the best way for people in Scotland, and across the United Kingdom, to show their support for the Black Watch Regiment is by recognising its ability to carry out the task in hand, and the historical importance of that task?

Tony Blair: My hon. Friend, who I believe was actually a member of the Black Watch Regiment—

Eric Joyce: indicated assent.

Tony Blair: My hon. Friend speaks with a particular authority, and I hope that people will listen to what he said. I am sure that, as someone who used to serve with the Black Watch, his words will command the attention and support of everyone.

David Heathcoat-Amory: On immigration and asylum, can the Prime Minister confirm the figure extracted from the Home Office in July showing that the United Kingdom has recently agreed to participate in 26 separate measures in that field, including measures defining unauthorised entry, transit and residence, visas, asylum, and the qualification and status of non-EU nationals in seeking entry to this country? Will he confirm that that figure is correct? If it is, does that not show a clear transfer of decision making and authority from this House to the EU, to be decided by majority voting, even if the Government disagree with the eventual decision by that procedure?

Tony Blair: We decide our own asylum policy here. The Opposition can make many criticisms of the asylum and immigration policy, but the one sure thing is that it has been decided here. However, with some measures we will want to opt in—for example, those to do with illegal immigration, for which it is important that we get European co-operation. Surely the best thing is for it to be the decision of the Government whether to take part. If we decide to take part, we do take part—presumably because we think that that is in our interest. If we decide not to take part, we do not have to take part. It is beyond me why that does not command the support of the Conservative party.

Harry Cohen: In the discussions with Dr. Allawi—who, according to the last poll that I saw, represented about 3 per cent. of Iraqi public opinion—was it maintained that the assault on Falluja was being done for the United Nations, as the Prime Minister maintained to my hon. Friend the Member for Halifax (Mrs. Mahon) last week? How can that be so, when the Secretary-General of the United Nations has urged that it should not be undertaken, and said that it would make legitimate elections in Iraq in January less possible?

Tony Blair: Surely, in the end, as for the decision whether Dr. Allawi commands support in Iraq—all the polling evidence that I have seen shows that he enjoys considerable support there—my hon. Friend may be right, or I may be right. Put it to the test. Let there be elections in Iraq in January, and let the terrorists and insurgents lay down their weapons so that those elections can take place. I would have thought that the best message—even from people such as my hon. Friend, who, for reasons that I entirely respect, was against the war in Iraq—would be to say, "Whatever we thought about the conflict in Iraq, lay down your weapons, let the United Nations-sponsored elections take place, and then let's see who has the support in Iraq."

John Bercow: It seems that there was no summit discussion of the worsening crisis in Burma. Given that the military junta there is guilty of savage violations of human rights every day, including using rape as a weapon of war, forced labour, compulsory relocation, use of child soldiers, use of human minesweepers, bestial destruction of villages and the incarceration of 1,400 political prisoners, does the right hon. Gentleman agree that it is essential that the European Union should adopt not token measures in the form of action against the pineapple juice sector in that country but a robust programme of targeted sanctions against the oil, gas and telecommunications sector, so that we can bring the regime to heel and offer the people of Burma the prospect of the freedom and justice that we have long enjoyed, and they have too long been denied?

Tony Blair: The hon. Gentleman makes a very powerful case. It is important that the European Union adopt stronger action, but to be frank, at the moment it is not possible to get that agreement in Europe. I understand that the matter was discussed at the General Affairs Council, but there is another and bigger issue: how the United Nations changes its charter and its rules, so that the way in which a country treats its own people can be a proper and fitting subject of international discussion. It is not only a question of Burma; there are many other countries in which people live in a state of deep repression, and it is only because of the absence of television cameras that no one notices or protests about it.

George Foulkes: On the middle east, the Palestinian Cabinet Minister Saeb Erekat said to me that the most useful help being given to the Palestinian Authority by any European Government is the British Government's training of the security forces, and he asked me to pass on his thanks. He also said that the Prime Minister, who has the trust of the Palestinian Authority and of the Israeli Government, is in a unique position to take an initiative to revive the middle east peace process. Will he take up that challenge?

Tony Blair: I thank my right hon. Friend for his comments about those who are engaged in the training of the Palestinian Authority's security forces. Britain has undertaken this work over a significant period, as well as work on political reform and governance. Actually, a lot has been happening underneath the surface that is very important, although not much noticed. As I have said before, I will obviously do everything that I can to ensure that this peace process becomes reinvigorated; plainly, that will be a significant part of the discussions that I have later in the week.

Michael Fabricant: But further to that question, given the grave ill health of Yasser Arafat, was any consideration given to the possible succession in Palestine? Does the Prime Minister accept that in a way the whole peace process is on a cusp? If the Palestinian organisation falls into the wrong hands, there could be impasse between Israel and Palestine, whereas if the right people succeed Yasser Arafat, the peace process could have a very real future.

Tony Blair: I agree, which is why it is important to proceed with measures that would allow elections in the Palestinian Authority to take place and the drafting of a new constitution. What is important is that we have empowered Ministers who can take decisions on security issues, but I agree with the hon. Gentleman that the situation is very much in the balance. It is important that we ensure that there is a Palestinian leadership that wants to make progress in the middle east. It is then for the international community to give that moderate Palestinian leadership support.

Harry Barnes: Is the Prime Minister aware that I utterly condemn, and wish to see countered, terrorism in Iraq not only against the Black Watch but against Iraqi citizens? Four railway workers, all of whom were members of the Iraqi Federation of Trade Unions, were murdered on 27 October between Mosul and Baghdad. What measures have been put in place in Falluja to ensure that such people—innocent people who are held hostage, as the Prime Minister himself put it—are not attacked?

Tony Blair: My hon. Friend—he was an opponent of the war, but he has taken a very honourable position on these issues all the way through—is right in saying what the dilemma is. The terrorists are trying to cause maximum difficulty, which is why they are taking over places such as hospitals, schools and mosques. That is the reason why the situation in Falluja has not happened before now. I know from my discussions with Prime Minister Allawi and his Government that over the past few months, they have been making every effort to get a peaceful settlement in Falluja. That included making it clear that, provided that Iraqi Government forces came in and took control in Falluja, there would be no need for multinational forces to be in there, and it included ensuring that it was realised that there would be municipal elections in Falluja. The problem that we now have, however, is that unless we take back control of Falluja, ultimately it will be very difficult for ordinary people there to make progress, but we are doing everything that we can to limit civilian casualties in the course of the action that we take, which is why this is being proceeded with in a very careful way. I entirely agree that the important thing is to ensure that the Iraqi people understand that in the end this is not directed at them, but at the people who are preventing them from getting a democratic outcome.

Desmond Swayne: I found myself in profound agreement with what the Prime Minister had to say about Iraq and the transatlantic alliance, but the gloss on the summit coming from the Elysée palace is very different, prompting the question whether the Prime Minister and the President of France attended the same European summit.

Tony Blair: It is probably not the first time that that has been said. Of course there are people in Europe who take a different view of what our attitude should be to the transatlantic alliance, but my answer is that we should remain in there, fighting for the right view of how Europe should co-operate with America, not get out and leave the field to those we disagree with.

Hugh Bayley: Does the Prime Minister agree that there would be security benefits as well as environmental advantages if the west, the European Union, the United States and other Organisation for Economic Co-operation and Development countries reduced their dependence on, and consumption of, oil? What will the EU do over the coming months to try to persuade the second-term US Government to take the problem of global warming more seriously and to reduce US consumption of oil?

Tony Blair: The emissions trading agreement is obviously an important part of what Europe is trying to do to deal with the problem. Europe as a whole has signed up to the Kyoto protocol. I think that issues connected to security of supply are making people think again, even in the United States of America, albeit from a different perspective. I have made Africa and climate change the key priorities for the G8, so there will be an opportunity to take this agenda forward. It is possible to see how we can do that—probably, when it comes to discussion with the Americans, through the route of science and technology. Long-term issues to do with energy supply, as well as climate change, make that imperative.

Robert Smith: Further to that answer, one of the explanations for why our constituents, especially the fuel-poor and large energy-using industries, are threatened with extremely high energy bills this winter is that we have managed to liberalise our energy market quite successfully in the UK, while mainland Europe has dragged its heels. Did the Prime Minister find anything in the summit to encourage any optimism that mainland Europe will eventually address that agenda, open up its own energy markets and decouple the price of gas from oil?

Tony Blair: The hon. Gentleman is absolutely right. The Council did discuss the issue of energy liberalisation and why it is important to pursue it. A process of change is now under way, and it will reduce energy prices for our consumers. One of the problems is that we have a liberalised energy market, while other countries in Europe do not, but the movement is definitely towards liberalisation.

Hugh Robertson: Did the Prime Minister have any discussions with other European Heads of State about the attitudes of countries bordering Iraq? Is there any evidence that any of those countries are providing men and equipment to the rebels in Falluja?

Tony Blair: A conference taking place in Egypt in the next couple of weeks will discuss that very issue. It is true to say that there are varying reports, but when Dr. Allawi visited Syria recently, he found a willingness to co-operate. I think that it is immensely important for both Syria and Iran in particular to ensure that their borders are not being used as a route for people to cross over and engage in terrorist activity. We are certainly making it very clear to those countries that any such support of terrorism in Iraq is unacceptable. I believe that the conference will play some part in flushing out people's positions and will send out a strong signal that those who support terrorists and insurgents are in breach of their moral obligations to the international community.

Jonathan Djanogly: The surrender of Britain's veto on asylum and immigration policy in favour of qualified majority voting forms part of the European constitution. That being the case, why is the Prime Minister taking the decision to give up the veto now? Can he not wait for the referendum, when the British people will be able to vote on the constitution?

Tony Blair: The hon. Gentleman said, "That being the case", but it is not the case. We are not giving up the absolute right to decide whether to opt in to any asylum or immigration measure, and that is very sensible. There are certain issues—for example, as I said a moment ago, people trafficking and illegal immigration—on which we want to be part of European action. However, we can decide those issues one by one. As my right hon. Friend the Home Secretary rightly said, it is the best of both worlds.
	The hon. Gentleman probably represents the mainstream view in the Conservative party today. It is not really about opting in or opting out, or this veto or that veto. What he and his colleagues want is a fundamental restructuring of Britain's existing relationship with the European Union—[Interruption.] Well, one or two Opposition Members shake their heads and many of them nod. Why do they not sort it out between themselves and come back with a proper position?

Regional Referendums

John Prescott: rose—[Hon. Members: "Hooray!"] Here today, gone tomorrow.
	With permission, Mr. Speaker, I should like to report to the House on the regional referendum in the north-east, held last Thursday. May I first congratulate Ged Fitzgerald, the chief counting officer, and his staff across the north-east, who ran such a well-organised poll and count? I also want to thank the police, the Post Office and the Electoral Commission for their co-operation during the referendum.
	Turnout, at nearly 48 per cent., was a great deal more than many people expected and has shown that all-postal voting can be extremely successful when the ground is well prepared. This ballot was conducted successfully, without witness statements, and the turnout has increased considerably. It was higher than the 42 per cent. turnout in the European elections in the north-east, higher than the 34 per cent. in the London referendum and similar to the 50 per cent. in the Welsh referendum. I am sure that the Electoral Commission will want to reflect on that.
	Throughout the referendum, the Government have made it absolutely clear that the decision whether to have elected regional government rests with the people. It is their choice and their say. Our policy of devolution, set out in our manifesto, means giving power to people in our nations and regions so that they can set their own priorities and make more decisions that affect their lives. As a result, London now has city-wide government and a Mayor powerful enough to run a global city. The Scottish Parliament enables the people of Scotland to make key decisions without recourse to Westminster for the first time in hundreds of years. The Welsh Assembly has given the Welsh people a powerful new voice to create jobs, prosperity, and social justice. Each of these new bodies was voted for by the people and has since proved to be very popular.
	It is worth remembering that proposals for Scottish and Welsh devolution failed to win public support in the first referendum in 1979, only for the situation to be reversed 20 years later in a new referendum. On 4 November, we offered the people of the north-east the chance to benefit from an elected regional assembly. Last Thursday, voters in the north-east decided by a margin of 78 per cent. to 22 per cent. that they did not want that, and of course we abide by their decision.
	I confirm to the House that the result of the referendum means that the Regional Assemblies Bill will not be introduced in the coming Session of Parliament; under existing legislation, there can be no further referendum on regional assemblies in the north-east for at least seven years; and—let me make it clear—despite press speculation, there will be no reorganisation of local government in County Durham or Northumberland arising out of this referendum result. Indeed, I hope that the two councils can now get on with delivering effective services for their people.
	The decision now raises the question as to whether to proceed, as we previously intended, with referendums in the north-west and in Yorkshire and the Humber. We have reflected on the outcome of the referendum in the north-east, as promised. We have also made it clear that referendums in the north-west and in Yorkshire and the Humber would have to wait until the Electoral Commission had completed its work on the "new foundation model for voting." That is not due to be published until the end of March 2005.
	The Electoral Commission has also said that there should be no electoral pilots using the new model until at least September 2005, but in the meantime, under the legislation, our ability to hold referendums based on the current soundings exercise runs out in June 2005. We would, therefore, need to conduct a new soundings exercise and bring orders to call the referendums before both Houses of Parliament under the Regional Assemblies (Preparations) Act 2003. All that would result in a long period of uncertainty for local government in the two regions, and we do not think that is acceptable. I will not, therefore, be bringing forward orders for referendums in either the north-west or Yorkshire and the Humber. If and when, in the future, a region wants to move ahead with a referendum, the House will have plenty of notice of that event.
	I do not want to underplay the importance of last week's decision, but the House should remember that elected regional assemblies are just one part of the wider programme of devolution and decentralisation in England. For a decade or more, it has been recognised that there are issues that must be dealt with at regional, rather than national, level, but which need to be co-ordinated over an area larger than any single local authority—[Hon. Members: "Why?"] Members should look at a map if they are in any doubt.
	That is why the Conservatives established the Government offices for the regions in 1994, and rightly so. We have since strengthened the Government offices to include more departments. We also created, in 1998, the regional development agencies as economic powerhouses for their regions; the Conservatives opposed them, but I believe that they have now changed their minds.
	In the last two years alone, the English RDAs have created or safeguarded more than 160,000 jobs and have played a major part in reshaping our regional economies. The House will be aware that in 1998 every English region was given the choice of having a voluntary regional assembly composed of representatives from local government, business, trade unions and the wider community. All eight regions—all of them—chose to have one of those voluntary regional assemblies. All parties are represented on them, and some are even chaired by Conservative councillors.
	Those voluntary assemblies have an important influence on housing, planning, transport, economic development and skills and training in their region. Those regional bodies play a co-ordinating, strategic role with the full involvement of local authorities and other representatives in the regions. The successful northern way initiative, launched in February this year, is a good example of the benefits of that co-operative approach.
	The RDAs and their partners in the three northern regions are working together to create more jobs, more prosperity and greater justice. The northern way has been warmly received, and has energised people in the three northern regions—that includes representatives of all political parties. It is one example of how, across the country, regional structures and initiatives will continue to work for the benefit of the regions with the full support of the Government.
	Our continuing agenda of reform and devolution to local authorities is equally important. That was evident in July, when we launched our document, "Local Vision", beginning an extensive consultation about the future of local government. It means allowing more decisions to be made in local communities. Along with the modernisation and reform of local government, we have taken several steps to devolve decision making to local authorities. We have removed the restrictive controls on local authority borrowing. We have given local authorities greater power to promote the well-being of their communities and the freedoms and flexibilities to deliver better services, and we are piloting local area agreements that will streamline funding from Whitehall so that spending can better reflect local priorities, determined locally. All those measures—every one of them—have been warmly welcomed by all local authorities.
	Our agenda for reform, change and modernisation means that we will continue to decentralise and devolve power wherever we can. We have already done a lot, and there is a lot more to do. We have already brought economic stability, lower unemployment and lower inflation; and our commitment to delivering the best possible future for all the regions remains as strong as ever.

Caroline Spelman: I commend the right hon. Gentleman for coming to the House and making a statement at the first opportunity, and I associate the official Opposition with his thanks to the returning officer and his staff.
	Will the Electoral Commission carry out a full evaluation of the referendum? The right hon. Gentleman is on record as having expressed surprise at the scale of the defeat, but how can the result have come as such a surprise? Was he not listening when the Chancellor of the Duchy of Lancaster, the right hon. Member for Darlington (Mr. Milburn), said:
	"We will lose because we have failed to get across a coherent message."?
	He should know; after all, 90 per cent. of Darlington's voters said no to a regional assembly, the highest proportion in the north-east. People understood, loud and clear, that the assembly would not put one more doctor, teacher, nurse or policeman into service.
	As for the Liberal Democrats, they were not surprised by the defeat. No sooner was it clear that they were on the losing side than they withdrew their support for the Bill. They might as well have the slogan, "Never knowingly missing a bandwagon".
	It is quite clear that the decisive "No" vote in the north-east has serious consequences for the Government's entire regional agenda. Will the right hon. Gentleman stick to the promise that he made to the people of the north-east on 19 October, when he said:
	"If you don't want it, we drop it"?
	What exactly did his long statement mean? Will he now say, loud and clear, that the regional agenda is dead? In broader terms, what does this humiliating defeat mean for the Government's whole regional agenda?
	What of the powers that have been stripped from local authorities and handed over to expensive, unelected regional chambers? The right hon. Gentleman criticised our participation in regional chambers, but our participation simply reflects the fact that core powers have been stolen from local government. He talks of a choice for the regions to have unelected regional assemblies. That is Hobson's choice. Given that the regional chambers now have no prospect of any democratic mandate, will the right hon. Gentleman abolish them? Will he return the crucial powers of housing, planning fire and rescue services to democratically elected local councils? Why not fill the vacancy in the Queen's Speech where a regional assemblies Bill would otherwise have appeared with a Bill to return the powers that have been stripped from local authorities? Or does he share the view of the Secretary of State for Education and Skills in seeing
	"councils as agents of central Government"?
	This is an urgent question; it cannot be fudged or kicked into touch. People up and down the land are living under the threat of huge house-building targets proposed by unelected regional housing boards. Is the right hon. Gentleman not duty bound to get rid of those housing boards as well? [Interruption.]

Mr. Deputy Speaker: Order. The House listened to the Deputy Prime Minister with politeness; those on the Government Front Bench should do the same for the hon. Member who is speaking for the Opposition.

Caroline Spelman: Thank you, Mr. Deputy Speaker.
	What about the cost of this whole sorry saga? The Government have ploughed tens of millions of pounds into the campaign for a regional assembly that only 20 per cent. of voters wanted. The whole exercise has been humiliating for the Government and expensive for the taxpayer. Is the right hon. Gentleman really serious about more soundings, throwing more money after bad? I am not going to ask him to resign because he will not, but the nation is owed an apology for the tens of millions of pounds wasted in pursuit of a pipedream that is very definitely history now—and, if the House is honest, so is he.

John Prescott: They must be joking.
	I thank the hon. Lady for her kind remarks at the beginning of her contribution, which I appreciated, and I can answer some of her questions. It is proper to ask about the Electoral Commission. I think that it has made a statement and there should be an analysis of the postal ballot. The all-postal ballot was very successful, without any talk of witnesses' statements or any problems whatsoever—that should make the Electoral Commission think about things. The commission will analyse the result and publish a report in—I think—the summer.
	On people's choice, I shall never apologise for giving people the opportunity to say whether they agree with   something on occasions other than the general election—I thought that the Conservative party was demanding referendums on the European constitution and the euro to give people choice. But referendums cost money. People need to be provided with information and leaflets so that they may make proper decisions, but that costs money, albeit not the tens of millions that the hon. Lady was talking about. The actual cost of running the referendum was £2.9 million—[Interruption.] I am just saying that if hon. Members look at the cost per capita of the referendums in London, Scotland and Wales, they will see that the recent referendum was cheaper. I must admit that the cost is a reality, but the alternative would be to do what the Conservative Government did. They abolished 18 councils and the Greater London council without any consideration whatsoever. They held no referendums, and the people eventually had to demand the right for a local authority. I will take no lectures from the Tories about abolishing local authorities.
	The hon. Lady put forward the argument that the assembly would have created not one teacher, nurse or doctor more, but that was never the intention—that was never in the White Paper. This Government have produced thousands upon thousands of doctors, teachers and nurses, but that was not the intended role of the assembly, although it does relate to one of the arguments that was put forward during the campaign.
	At the end of the day, we must consider the effect on the regional agenda. I said in my statement that I believe there is still a strong argument for a regional dimension, otherwise things will be left to unelected quangos and civil servants.

Eric Pickles: Scrap them.

John Prescott: The hon. Gentleman shouts, "Scrap them", but he was a member of the Government who set them up. The regional government civil servants were set up in 1994 for one good reason: decisions had to be taken on a regional basis, so the Conservatives set up the regional Government offices. We came along and established the regional development agencies, but the hon. Lady did not say   whether the Conservatives are for or against them.   Although the hon. Member for North Essex (Mr. Jenkin) says that they have not said that they are against the RDAs, their manifesto made it clear that they would abolish them. They say that they have had a change of heart, so perhaps she will tell us whether they will get rid of the RDAs.
	We will keep regional Government offices and regional development agencies, and as for the regional assemblies, we will keep them also. They are not as good as assemblies with directly elected members, but people are directly appointed to them. Elected councillors serve on them, so they can make decisions about regional priorities instead of the unelected members of quangos. I think that that is right. That dimension will continue and we will support it, working with local government.
	If the Tories are against regional assemblies, it would be useful to hear why they do not tell all their councillors to resign from them—they joined them voluntarily. If the Tories do not want them, they can get off them. If they want to be honest, that is what they should do. We will keep the regional assemblies, the regional development agencies and regional government. The regional dimension will form an essential part of this Government's policy to correct the economic differential between the north and south of this country. Let us be clear that that is our intention.
	I was a bit surprised that the hon. Member for Meriden (Mrs. Spelman) was asking the questions, because we were all waiting for the big man to come in—the hon. Member for North Essex. He was the guy who said that if turnout in the vote got anywhere near 50 per cent., he would eat his hat. I believe that he has eaten it already, so on that he was wrong—just like everything else that the hon. Lady said.

Edward Davey: I thank the Deputy Prime Minister for his statement and agree about the professionalism of the officials and police during the process. He knows that Liberal Democrats share his disappointment at the outcome of the referendum, but equally believe that all democrats need to respect the voice of the people, especially when it is spoken so clearly.
	Is the Deputy Prime Minister worried that with elected regional assemblies off the immediate political agenda, a growing democratic deficit remains in our regions which needs to be tackled in another way? There are quangos that he inherited from the Conservatives, as he told the House, and quangos that Labour Governments have created and they need to feel the heat of greater accountability. Will he therefore revisit his decision to force through the House and the other place, against Liberal Democrat and Conservative opposition, the taking of strategic planning powers away from county councils? Is not planning one example of powers that can quickly be handed down and given back to local government? Will he set up a cross-departmental review of all elements of Britain's regional bureaucracy to consider how democratic accountability and efficiency can be improved in the absence of directly elected assemblies, especially through stronger local democratic input?
	The Deputy Prime Minister knows that from the White Paper on, the Liberal Democrats felt that the regional devolution he was offering was too weak and the package of local government reorganisation too confusing to ensure that the "Yes" vote was maximised. Given that he has come to the House so quickly to discuss the defeat and to tell the House his position, will he at least admit that the Government were wrong on powers and wrong on the linkage with local government reorganisation?

John Prescott: I am grateful for the hon. Gentleman's comments in support of the people who were involved in running the ballot. I am also grateful that he took part in the debate and for the statement and visit by the leader of the Liberal Democrats, the right hon. Member for Ross, Skye and Inverness, West (Mr. Kennedy), in support of the regional assembly. I am bound to say, however, that I did not find many more Liberals beyond them who were in favour of it. The others on the ground melted away, so there was no great Liberal support. [Interruption.] Well, in the last week of the election you made the statement that you would kill the Bill—

Mr. Deputy Speaker: Order. The Deputy Prime Minister must be careful to use the correct parliamentary language.

John Prescott: I am sorry, Mr. Deputy Speaker. I must get my procedure right.
	In the last week of the election, the hon. Member for Kingston and Surbiton (Mr. Davey) made the front-page statement:
	"We will kill the Bill".
	Quite frankly, that is the kind of support I could do without. I had the feeling that the Liberals were with us one moment and against us the next. It is the Liberal flip-flop in British politics, and I should have got used to it by now.
	The hon. Gentleman talked about quangos established by us. That is true: the regional development agency is a quango. When I introduced the idea of regional development to the House, I said that we had not yet introduced democratic accountability. That was the purpose of the assembly: to have an elected assembly that subjected those quangos to that accountability.
	As for whether there are sufficient powers, those arguments will go on. There has to be an agreement in government about the distribution of powers from Whitehall to the regions. That is inevitable. I gave the best negotiated position that I thought was sufficient. I note that Mayor Livingstone of London came to the area and said that he wished that he had the same powers that we were proposing for the north-east. I just comment on that, him being the mayor of Livingston—I mean Mayor of London.
	We will analyse what caused the emphatic defeat, and it was an emphatic defeat, of the idea of a directly elected assembly. Not many Conservatives campaigned against it, however. They were all kept down here, their mouths quiet, and were never involved in the election. I must make it clear that the defeat was not the result of one thing. If one issue did run through the campaign, however, it was that the people felt that it would mean more politicians. I was constantly challenged about that. In fact, there would have been 500 fewer because of the abolition of the councils.

Eric Pickles: They did not believe you.

John Prescott: I am just giving the facts. The people decided that they did not like the idea of more politicians. Perhaps the council tax played its part in that, even though it would have meant a £12 million saving, with 10 more councils abolished. [Interruption.] I accept their decision, but I can have a different view. That is why I introduced the Bill. However, the people have spoken and I am now reacting to that. I accept their decision and I am reporting it to Parliament.

Stuart Bell: The House will welcome the statement by the Deputy Prime Minister that there will be a continuing agenda of reform and devolution for local government. He referred to powers that we have given back to local authorities to promote the well-being of their communities. Does he recall his visit to Middlesbrough with the Prime Minister, when he saw a community in action at a community council, where the people told him that those powers had given power back to the people, and that their community had been enormously improved as a result? Will he reiterate that there will be a continuing decentralisation and devolution of those powers to local communities so that they can all benefit from the actions of a Labour Government?

John Prescott: I certainly can. I well remember my visit and the meeting that I chaired with my hon. Friend, where there was great support for the proposal. The reality is that the decision was still 8:2 against us and, whether I like it or not, I must face up to that. However, I can assure him that decentralisation and reform of local government will continue. The democratic point, albeit important, was only one part of modernisation and reform. I do not know—eventually, people may come round to accepting that unelected individuals should not make decisions for them, and decide that they want elected individuals. However, the people have spoken in the north-east, and at this stage they do not want a regional assembly. If politicians are to be worth anything they must take that into account.

William Hague: Will the Deputy Prime Minister give the people of the north-east the hearty congratulations of their neighbours in North Yorkshire, who would have voted no in equal or even greater proportions if the referendum there had gone ahead? Does he accept that one reason for the public rejection of those ideas is that, except where whole tiers of government have been abolished without replacement, people's experience of local government reorganisation under successive Governments is one of vast expenditure with very few benefits to show afterwards? Could he not do a great deal for long-term respect for local democracy and civic pride in local institutions, as well as enable councils to get on with the job in the way that he described earlier, by declaring the whole era of local government reorganisation to be well and truly over?

John Prescott: No, I do not accept that   for one moment. It was under the previous Administration, who abolished 18 councils, that costs became really extraordinary. Most people who speak about the evidence of reorganisation of local government refer to the way in which it was done under a past Administration, when 18 councils were abolished without any consideration. I therefore do not accept that we have reached an ideal stage in local government. We stand for unitary authorities, as the right hon. Gentleman knows. [Interruption.] Well, it is our policy and we believe in unitary authorities. Curiously, the Tories in England say that they do not like unitary authorities—they want to keep the counties—so why did they force them on Scotland without any consultation whatsoever or even leaving the issue to be decided by the Scottish Parliament or an assembly? As for the right hon. Gentleman's point that the vote would be bigger in Yorkshire, I do not know whether that would be the case. However, in the Welsh referendum in 1979, there was an even bigger defeat for people who wanted devolution. Twenty years later, however, they came back and voted for it when they realised its full benefit.

Lawrie Quinn: May I thank the Deputy Prime Minister for his statement? Returning to the issue of scrutiny that should be afforded Parliament, the Regional Affairs Committee meets very infrequently. Does he foresee the possibility of looking at arrangements for that Committee, and perhaps extending them to allow Select Committee-type powers for areas such as Yorkshire and the Humber, the north-east, the north-west and other English regions to make sure that Parliament scrutinises those regional bodies?

John Prescott: I understand the point that my hon. Friend is making. I have been a Member of Parliament for over 30 years, although some people want me to go now, and have witnessed demands in the House and the Chamber to set up various regional committees. I have always supported those demands, but the House does not have a very good record of providing much influence or power to Members, and we are told that there is no time for debate. The last regional debate was on the northern way, when one Tory turned up. Despite demands for Parliament to deal with regional affairs, the evidence, I am afraid, is against such a role. I am supportive of my hon. Friend, but the pressure of time on this legislature is one reason why people in the regions should make their own decisions. We have neither the time nor frankly the inclination to debate regional matters in the Chamber.

David Curry: Does the right hon. Gentleman accept that one of the unbridgeable problems in the referendum was the colossal gap between the rhetoric that was used to describe the proposed devolution and the powers that would have accompanied it? Was not that because the Government—least of all the Deputy Prime Minister and the Prime Minister—never made up their mind on what powers they wanted to devolve, so the Deputy Prime Minister spent the last few days of the campaign scratching around for any powers that he could beg, borrow or steal to make the proposals look substantial? Is not the lesson that, with future policies, the Government as a whole need to make up their mind on what they want and to concede to people substance, not shadows?

John Prescott: The House recognises that the right hon. Gentleman is a fair man in his appraisal of these matters and knows a great deal about local authority and regional issues. In fact, he was one of the few Conservatives to say that, if the assembly had more powers, he would vote for it. That was certainly his position, if not that of his Front Benchers. The powers were clearly set out in the White Paper and the question whether they were enough was constantly debated in the House. We went further than the White Paper on fire, planning arrangements and transport. Some might argue that the assembly should be a parliament with the powers that we have. That is fair enough. We tried to strike a balance between local authorities, Whitehall and Westminster, and that is what we tried to explain to people. However, the question of powers was not the main issue. To be honest, people were mostly concerned about whether they wanted another layer of the decision-making process. The question that constantly came up was, "Does this mean that there will be another tier, that we are going to pay for it and that there will be more politicians?" It did not matter that I could show that that was not so, because they had reached their conclusion and that was it—they thought that it would be a white elephant.

David Clelland: I congratulate the Deputy Prime Minister on his work on this over the years. His quest to extend democracy is an honourable one, and he should be congratulated on it.
	Is my right hon. Friend aware that, as recently as this morning, constituents have contacted me to ask for more democratic control of local services privatised by the Conservatives? Is not there still a case for extending democracy to the regions and localities, and can we look for other ways of doing that?

John Prescott: I thank my hon. Friend for his kind personal remarks. I noted that, immediately after the result was announced, even the no campaign was saying, "We still need to find ways to deal with this issue", and that has continued. I have even heard voices calling for national conventions, which is precisely what happened in Scotland and Wales. I do not support that, but I would sooner hear what people have to say about it. The no campaigners have started to wonder whether they have missed an opportunity. They voted against it, but now they are saying, "Can we have something, albeit different, after all?" I have to ask whether they are whistling in the wind.
	We will continue to reform the local government structure. We will devolve more powers downwards by strengthening regional development agencies, regional government and assemblies. For the moment, that will have to be the way forward for the north-east.

John Greenway: I am grateful to the Deputy Prime Minister for his statement. Does not he realise that his refusal to rule out completely a referendum in Yorkshire and Humber and his response to my right hon. Friend the Member for Richmond, Yorks (Mr. Hague) on unitary authorities will only prolong the uncertainty as regards local government in North Yorkshire? Most people in North Yorkshire—a county that is almost 100 miles wide—think that they already have regional government through North Yorkshire county council. Will the Deputy Prime Minister get on with the job of devolving powers back to it so that, as my right hon. Friend said, we can get good people elected into the council chamber and get some decisions made locally?

John Prescott: I thought that I had made it clear to the House that changes to the local government structure of, in this case, Northumberland and Durham would fall if the people said no, which is what they clearly did. I made it clear that no changes to the local government structure would arise out of the assembly. Our manifesto stated our belief in establishing unitary local government, but that would require primary legislation.

Philip Hammond: Wrong—ask the Minister for Local and Regional Government.

John Prescott: I am only passing on the advice that I receive. I do not necessarily agree with the hon. Member for Ryedale (Mr. Greenway). Basically, local government reorganisation would need to go through a proper process. As that is not being proposed, the local government structure that we have at the moment is not affected whatsoever by this decision. Local government as it is, in its county, district and unitary form, will continue.

Ronnie Campbell: I thank my right hon. Friend on behalf of the north-east of England for at least giving us a vote. If the Tories had been in power, we would not have got one. People are basically saying that they want more democracy in their areas and their councillors to be more professional but, unfortunately, we lost the vote. We should have some sort of organisation, even if it has to be in Parliament, to tie the north-east together, join the threads and get moving because we are being left behind by the Welsh, the Scots and Londoners.

John Prescott: I am grateful for my hon. Friend's words. I read some of the reports on Friday and Saturday after the results and I have heard the comments that we should do something. I presented one proposal, which the people in the north-east emphatically turned down. I can therefore only say that we shall continue to see what we can do to strengthen the assembly, RDAs and local government generally. Giving people more power to make decisions means devolving some of the decisions from local government to communities. We are doing that; it is embodied in the local vision and we shall continue with the reforms because we want to decentralise decision making.
	I am sorry about the decision that the people in the north-east made, but it is their decision and it is our job to recognise that. However, I reassure myself by remembering that a successful conclusion was ultimately reached in Wales and Scotland.

Douglas Hogg: The right hon. Gentleman will acknowledge that his proposal for directly elected regional assemblies was at least a partial answer to the West Lothian question. Given that it has failed, will he consider preventing Members who represent Scottish constituencies from voting on exclusively English business?

John Prescott: No.

Gordon Prentice: I congratulate my right hon. Friend on his decision not to press ahead with a referendum in the north-west of England, which would certainly have been lost. Was the referendum in the north-east lost during or before the campaign?

John Prescott: I am used to clever questions from my hon. Friend. It is time to worry when we get support from him. I do not know why the referendum was lost—there is a range of reasons. I have probably spent more time than anyone else defending the proposal and listening to people's views in markets, streets and in debates. I gave some of the reasons, which included worries about too many politicians and cost. Europe was mentioned from time to time, as if the proposal were a Euro-plot. All those factors played a part. I do not think that there was one major reason. I cannot therefore really give an answer to the question "Why?". All I need to know now is that I did not convince people and that I was emphatically defeated. I have had to take the consequences today. As to the north-west, we must wait and see.

Andrew Stunell: I thank the Deputy Prime Minister for his statement and share his disappointment. He may know that the Northwest Development Agency held a meeting last Friday as a briefing for Members of Parliament. Several Labour Members attended, as I did. The development agency was clear that some untidy ends remain in the north-west. The links between the agency, the Government office for the north-west and the Learning and Skills Council are not as strong as they should be and accountability remains poor and divided. Will the right hon. Gentleman assure us that he will take those issues forward and improve the accountability of those big budget quangos?

John Prescott: That is an important question, which I had to address during the debate. We produced a White Paper that reflected the judgment between Whitehall and us about the powers that could be redistributed. Some were already undergoing a form of reorganisation. The Learning and Skills Council was a classic example of something that was established both nationally and locally. As I said earlier, people found in the regions that regional directors had to be appointed to make regional decisions about training. I argued after the White Paper that people in the regions should make the decisions. Local bodies alone cannot do that; there needs to be regional decision making. That has been recognised by the Learning and Skills Council, and the fact that we approved the number of people to be appointed by the assembly to sit on the board responsible for training is an improvement. This is also a recognition that regional dimension decision making is going to be there all the time, whether it involves elected people or unelected people.

Peter Pike: I understand why we cannot go ahead with the referendum in the north-west, but it is very disappointing. I urge my right hon. Friend not to lose sight of the fact that, while there has been a reversal in the north-east, the case for regional devolution and accountability has not been lost. There is still a very strong case for it, because too many strategic decisions are still being taken by unelected and unaccountable people. I hope that he will address that issue. In the case of local government in Lancashire, does he recognise that the changes brought in under the Banham review by the Conservative Government were a poor, hybrid solution that introduced two unitary authorities and left the rest of the county with two-tier local government? That also needs to be addressed.

John Prescott: I certainly agree with my hon. Friend's last comment. In regard to regional devolution, the thing that has always convinced me of the need to do more than simply leave things to central Government is the increasing differential between the north and the south. It has now been measured that if the three northern regions were to secure the same level of growth in gross domestic product that there is in the south, they would be £30 billion better off and there would be 250,000 more jobs. That is the reality. While all the regions have now increased their prosperity under the Labour Government and reduced their unemployment by half, the differential still exists. That is why I feel strongly that we need to do something more.
	The institutional changes in London, Wales and Scotland have made a difference and I tried to argue the case for such changes in the north-east. I certainly recognise that that argument is also true for the north-west, but it will be up to the people of the north-west to make their views clear. We have kept the legislation relating to these measures, and if it is their declared opinion that they want one, the legislation remains for another exercise, but not within the next year or so.

Graham Brady: Many Members on both sides of the House have been telling the Deputy Prime Minister for months that the soundings exercise was incompetently handled. Does he now accept that he completely mishandled that process and completely misread public opinion through the soundings exercise?

John Prescott: No.

Clive Betts: I am sure that my right hon. Friend will agree that, while this particular proposal might be dead, the principle of devolution most certainly is not. We on this side of the Chamber need take no lectures from the Conservatives on devolution, because when they last occupied the Government Benches, they were the most centralising Government this country had ever seen. When the dust has settled, will my right hon. Friend consider introducing either a White or Green Paper to examine a new constitutional settlement for this country, based on the principle of devolution, to address the regional democratic deficit and to examine the transfer of significantly more powers to local government, including the right to regulate local public transport?

John Prescott: Of course, those were some of the powers that we were considering that the assemblies should have, particularly on a regional basis. I know that my hon. Friend was a little critical of our proposals, but he now wants to renegotiate and discuss them. Fine. I hope that the debate will continue, but I think that the opportunity has been lost. That argument has taken place in the north-east, to a certain extent, although in my view this will still come, in the north-east as well as in Yorkshire and Humberside. In the meantime, however, my hon. Friend is right to say that we should now ensure that our local government structure delivers in the best way. The councillors who sit on local authorities already sit in the regional assemblies so, although they are not directly elected to them, they are indirectly elected. That will give them some authority, as opposed to the quangos and civil servants in regional government who make the decisions at the moment.

George Osborne: The decision not to proceed with the referendum in the north-west is very welcome and is, in part, a tribute to the North West Says No campaign, which was enthusiastically supported by many Labour MPs. The Deputy Prime Minister has ruled out a referendum in the north-east for seven years. Is he also ruling out a referendum in the north-west for seven years?

John Prescott: The ruling out comes from the statutory obligation that the House imposed on us, but that does not apply to the north-west or to Yorkshire and Humberside, because they have not had referendums. Had they done so, and said no, it could apply. It is therefore possible that if a particular view was developed and assessments were made in the north-west and Yorkshire and Humberside, they could still have a referendum. The legislation is there for them to do so if they so wish.

Angela Browning: May I say to the right hon. Gentleman, in the most friendly way, that he will wait a darn sight longer than 20 years to get a yes vote out of Devon and Cornwall? He is into hell freezing over territory there. If he is not going to abolish those unelected bodies that are spending money on our behalf, will he please have a referendum in the south-west? I promise him that he will have good news at that Dispatch Box about the turnout—it will be really high.

John Prescott: I fear that the hon. Lady might be eating her hat as well. She puts Cornwall and Devon together, but if the vote on the decision were held solely in Cornwall, I wonder whether she would be so confident about the result.

John Redwood: In Wokingham we have a unitary council, thanks to the previous Government, and we would like that council to make the crucial housing and planning decisions that affect our lives. Now that the Deputy Prime Minister has shown that even he cannot push the vote out for elected regional government, will he get rid of the unelected junta in Guildford and give the powers over planning and housing to my local elected councillors, who would do a good job with them?

John Prescott: The right hon. Gentleman makes a point about the unelected junta, but it is staffed by many Tories, I understand. Out of 100, 44 Conservatives sit on it. I just make the point that they seem to be actively participating—[Interruption.] There are 44 Tories sitting on it, right? All I am saying is that if the right hon. Member for Wokingham (Mr. Redwood) looks at the decisions on these regional matters of housing and planning—all of them have a regional dimension—he will see that the local authorities, whether unitary or county, are not sufficiently wide to take the regional dimension into account. That is why the Government set up the regional offices to deal with these matters and to find a regional decision. They were right on that and we are right to add democratic accountability to it. I look forward with interest to see how many Tories are going to resign from these assemblies.

Teddy Taylor: Will the Deputy Prime Minister promise to take seriously the implications of what may be unexpected, but is a substantial and clear expression of opinion by the people? Is he in particular willing to give the people of Scotland and Wales the opportunity to have another referendum to ask whether they wish to retain their devolved Administrations, bearing it in mind that I gained a clear impression from my visits there that people are fed up to the teeth with the cost and bureaucracy of those organisations? Is he willing to give the people of Scotland and Wales a chance to say whether they wish to keep their devolved government?

John Prescott: That matter is something that the people of Scotland and Wales have the choice to develop themselves, if they wish. I note that when devolution was opposed by the Tories, that effectively destroyed the Tory party in Scotland.

Eric Forth: Following this excellent expression of common sense by the people of the north-east, and indeed the question of my hon. Friend the Member for Rochford and Southend, East (Sir Teddy Taylor), will the Deputy Prime Minister consider giving the people of London a further referendum so that they can express their view on whether they think that this outrageously expensive assembly and Mayor are worth the money spent on them or whether it is time to lay them quietly to rest?

John Prescott: What an absolute cheek from somebody who supported the abolition of the Greater London council with no consideration whatever for the people and now advocates a referendum. Is not the cost a consideration? Is not the democratic mandate? It is hypocrisy we expect from those on the Tory Benches and we get it.

Sydney Chapman: The Deputy Prime Minister will know that many provisions in a number of recent Government Bills have transferred powers of one sort or another upwards to the regional authorities. There was the expectation or hope—the word can be chosen—that directly elected regional assemblies would be a reality, but now that it is apparent that they will not be a reality for some time, will he, where possible, consider those recently enacted measures and not activate those provisions, which would take power from directly elected local authorities of one sort or another and give it to unelected regional authorities?

John Prescott: First, I am not readily accepting, because there has been one decision in the north-east, that we will not move towards a regional dimension, and eventually an elected one.

Bernard Jenkin: The right hon. Gentleman can.

John Prescott: I have accepted the decision and I am giving my judgment. I am entitled to do that; I am still a person with a political view. I am not giving up what I have believed for 30 years, which will eventually come about, as it did in Wales and Scotland.
	With regard to the point about powers being taken away from local authorities and some going to the regions, whether they are on planning and the regional dimension, housing, transport or the fire and emergency services, where it is felt that the local authority boundaries are not sufficient to deal with the region-wide considerations, there are regional decisions for which the local authority boundaries are inadequate. I have to say, because the hon. Member for Chipping Barnet (Sir Sydney Chapman) was a member of the Government who did it, that the regional government civil servants and the Government offices were set up to deal with that problem because of the inadequacy of the boundaries and powers of local authorities.

Peter Lilley: Does the Deputy Prime Minister realise that, if a referendum were held in the east of England in general, and Hertfordshire in particular, it would be defeated not by 4:1 but by 40:1? Does he realise that that is because people resent the transfer of power that has already taken place from local authorities to a more remote and distant regional authority and the efforts by that authority to impose housing targets on Hertfordshire that are wholly unwelcome to its residents? Previously, when Hertfordshire had the opportunity to take such decisions, and a Lib-Lab county council tried to impose building on the green belt, we were able to defeat it at the ballot box and change the policy. We want those powers back at county level, so that we can determine our own future.

John Prescott: I do not know whether the proposal would be defeated by 40:1 in the east of England—[Interruption.] Even if it were 50:1, the right hon. Gentleman is showing his arrogance by feeling that he knows what the outcome would be. What we have done is to put the question to the people and let them make the decision. There is an important difference between those two positions. I may give my judgment to the region, but it may reject it, as it has done on this occasion. I am not therefore acting on my judgment, as, to its mind, my judgment was wrong. I will not assume that I know what the outcome will be in the eastern region, but the assembly there has 36 Tories on it, is chaired by a Tory, and is considering the housing situation and recommendations on it. We are in discussion with it, but I notice that it and the Government differ by only a few thousand on what housing is needed in the area. We will continue the discussion.

Roger Gale: A few moments ago, the Deputy Prime Minister said that he did not understand why he lost the referendum in the north-east. The reason is blindingly obvious. He lost the referendum in the north-east, as he would everywhere else in the country, because the people of this country do not want regional assemblies. That being so, he went on to say that he has learned the lesson and that he accepts the result. But he does not, because he said that regional assemblies will continue. The South East England regional assembly is not only unelected but unloved and unwanted. Why should the people of Kent pay for a quango for which they have not voted and that they do not want?

John Prescott: Again, I do not know how the hon. Gentleman can assume what will happen in other areas. We must wait and see. As for my accepting the judgment of the north-east, I have done so. I asked it not about the regional assembly but about an elected regional assembly. It chose to vote against it, and I have announced to Parliament today that I have no intention of bringing forward the Bill that would make such an assembly a reality, because the people have spoken. In those circumstances, the unelected regional assemblies, rather than unelected quangos, need to make decisions about matters that affect their regions, as at least they are indirectly elected—again, I suspect that in the south-east, the assembly will have more Tories than Labour members. I think that that is right. We will fully support the assemblies, we will get on with it and I wait to see how many Tories will resign from them.

Richard Ottaway: Referring to the deferred referendums, the Deputy Prime Minister said that, if in future a region does not want to move ahead with a referendum, the House will have plenty of notice of that. How will he ascertain whether a region wants to move ahead with a referendum and what criteria will he use?

John Prescott: The Regional Assemblies (Preparations) Act 2003 lays down how to consult and report back. I did that for the north-east, Yorkshire and Humber, the north-west and all the regions. Those were the only three regions in the north, on consultation, in which more than 50 per cent. wanted to have a referendum as to whether to have an elected assembly. That is laid out in the Act, and if the consultation process is to happen again, that remains what will take place and be reported to Parliament.

Andrew George: Will the Government genuinely learn the lessons rather than give up? Will they let the people genuinely decide in which regions to hold referendums, on which powers from the menu, when to hold them and on whose terms? I agree with the Deputy Prime Minister that the Government would have won a referendum in Cornwall, but when will we get that referendum?

John Prescott: First, I am not giving up, and I hope that I do not give that impression. I am being attacked for not giving up on all regional policy simply because the democratic mandate—which I would have thought that the House would regard as an important principle—should apply to decisions in the regions. People have rejected the proposal, and I have accepted that. The House should make no mistake: I am not giving up on the regional dimension and democratic accountability. I have always believed in it. I think that there is a reason for the fact that, in terms of growth, the north suffers more than the south, but in view of the decision made in the north-east, I will not proceed with a Bill.
	As for Cornwall, the hon. Gentleman will be well aware of one of the first lessons that I learned about regions, and I learned it again in the north-east. People in Devon do not like Cornwall, and Cornwallites do not like Devon. People in both counties dislike Bristol and all of them hate London. In my own area, Hull and Grimsby cannot get on. When I went to the north-east, I thought that there might be a bit more of a regional identity there, but as soon as people started saying in Newcastle that Newcastle footballers were telling them to vote yes, there was not the same feeling in other parts of the region.
	There are strong rivalries within regions that must be taken into account, but in general people know what constitutes a northern region and are proud to belong to it. We are doing our best to reduce the differential in prosperity between the north and the south—and, I might add, the south-west.

Alistair Burt: The Deputy Prime Minister spoke of the growth differential between north and south. His building plans for the south will accentuate the difference, because of the resources that they will draw in to boost the south-east further. Does he not understand that the anger felt in counties such as Bedfordshire, which faces the construction of 80,000 more houses over the next 20 years as a result of his decision, is just as great as the anger that he experienced last week? Given increasing evidence of the danger of such a rate of growth, will he abandon those plans, listen to local people and show that he knows the difference between regional co-operation and regional coercion?

John Prescott: I was trying to recall the hon. Gentleman's constituency—[Hon. Members: "It was Bury."] It is not Bury now, though. [Interruption.] Is it still Bury? If so, I apologise. But I remember the hon. Gentleman losing his seat in the north, and as he well knows the housing situation in the north is very different from that in the south. We have to meet housing demand in the south—

John Redwood: Why?

John Prescott: If the right hon. Gentleman has a son or a daughter, I assume that, given his circumstances, they would be able to get a house. But many people cannot afford houses or mortgages and do not want to get on a train and go north to improve their quality of life. They want to live in the south. We have shown that it is possible to build more housing by increasing density and using brownfield sites, as we have, without increasing the amount of land it takes. We must make that kind of intelligent decision rather than telling young people, "You can't live near your mum and dad and you can't have a job in the south. Go north, young man." In fact, it is possible to do both.

Edward Garnier: Will the Deputy Prime Minister let me into a secret? Was all this one of those eye-catching initiatives with which the Prime Minister wished to be personally associated?

John Prescott: Daft question.

Damian Green: I think that that means that the answer is no.
	The Deputy Prime Minister has made it clear this afternoon that elected regional assemblies are now dead, but that he is as wedded as ever to unelected regional assemblies. Can I tell him how much that will disappoint my constituents, in a week when the South East England regional assembly has come up with a maniacal proposal to build even more houses in my constituency and the rest of east Kent than he himself proposes to build?
	Is that not a prime example of the way in which the South East England regional assembly is out of touch and does not reflect the views of local people in parts of Kent? It is not just a waste of money but is actively doing more harm than good to the quality of life of my constituents and many other people in the south-east. Why does the Deputy Prime Minister not admit that there is no desire for a regional dimension in the south-east and scrap the regional assembly now?

John Prescott: I am confused by the hon. Gentleman's remarks. It was his area that wanted growth and houses, and it was his area that wanted the channel tunnel rail link to stop there. It was bound to be one of our growth areas. We think it important to do what we are doing, and the pressures that he is talking about are certainly not as great in his area as those in other southern areas that Members have mentioned. The housing will improve quality of life, and it will be connected to a damn good transport system, as we know from the announcement of the domestic services that will feature on the rail link. The hon. Gentleman should stop whining and enjoy his advantages.

Mark Prisk: How much has this failed experiment under the Deputy Prime Minister's stewardship cost to date? Why does he not understand that what people want, whether they are in the north-east or in my region—he likes to call it East Anglia but we still like to think of ourselves as Hertfordshire, and we will fight for that all the way—[Hon. Members: "Oh!"] We will, I can assure him of that. Why does he not understand that people want local services from democratic local authorities? They do not want his herd of white elephants.

John Prescott: The hon. Gentleman's contribution was a little short on history. Did not the Tories abolish Berkshire? The right hon. Member for Wokingham (Mr. Redwood) nods. Where was the hon. Gentleman fighting then? Presumably, he was a candidate objecting to what his Government were doing.
	The cost of the election in the north-east—[Interruption.] May I give the answer as best I can? The cost was £2.9 million. Elections were not held in Yorkshire and the Humber or in the north-west, but there was an information campaign, which cost approximately £10 million. Per capita, it was no more expensive—in fact, it was cheaper—than the referendums in Scotland and Wales, but if we consult people there is a price to pay. I do not know whether the hon. Gentleman will object to the costs of the referendum on the European constitution. Would he say that we should not hold that because it will cost more? I suspect that the right hon. Member for Wokingham would say that it is money well spent. The hon. Gentleman's question was just a bit of argy-bargy in the Chamber, and there was no sense behind it.

Mark Francois: I sincerely hope that last shall not be least.
	The Deputy Prime Minister has advanced a strong argument for the continuing devolution of powers to local authorities, as he put it. May I ask him to follow the logic of his argument? Will he devolve back to local authorities the power to decide how many houses should be built in their areas? Surely it is better that directly elected local councillors, of whatever party, decide how many houses their area can bear, rather than having numbers imposed on them by unelected regional bodies whose moral authority has been destroyed by what happened in the north-east.

John Prescott: The hon. Gentleman must be aware that, under the previous Administration, housing numbers were decided not by local authorities but by Government and the boards that were set up.

Mark Francois: In negotiation.

John Prescott: Fine—and that is what we are doing. The south-east and eastern regions are  matters for negotiation, but the previous Administration imposed housing figures on local authorities—[Interruption.] I am bound to say that they did. They imposed figures against the will of local authorities. However, the main argument is not whether the Government impose the figure but whether, if it is left to local authorities to decide the housing for a whole region, most local authorities will just vote against. Even among elected members, there is a predominance of nimbyism—we do not want it here. We are entitled to say that, if there is housing demand in an area from people who need it, we must meet that. It is a matter of negotiation between central and local government. We decided that housing boards in the region were better placed to decide from where the land was to be found to provide the houses. We think that that was right. It is a regional dimension—it is a far greater regional basis than would otherwise be the case, considering what local authorities can do with the powers in their boundary areas.

Point of Order

Hywel Williams: On a point of order, Mr. Deputy Speaker. Mr. Luis Austin is an Argentinian from the Welsh settlement in Patagonia. He is a Welsh speaker who is visiting my constituency. Some two weeks ago, he was stopped at Gatwick airport and told that he would have to leave the country after what I can view only as a naive breach of regulations. He was then told that he should leave the following Thursday. Some time later, he was told that he could stay until the matter was settled. Later, he was told by letter, which was sent to the wrong address, that he should leave the United Kingdom. Last Thursday, he was told that he could stay until 2 December; last Friday, he was told that he must leave tomorrow, 9 November. Unsurprisingly, he is confused. That sorry catalogue of events can only diminish the reputation of the immigration service and, importantly, damage the relationship between Patagonia, the Welsh people there and the UK, which this Government and the Administration in Cardiff have fostered. Despite all that, the Minister of State at the Home Office has refused to meet me. Can Mr. Speaker use his good offices to prevail on the Minister of State to meet me before tomorrow afternoon—before it is too late?

Mr. Deputy Speaker: I have listened carefully to the hon. Gentleman, but this is not a matter for the Chair. There are channels laid down for such matters—ministerial channels and others, and he must pursue those in the normal way.

Housing Bill (Programme) (No. 3)

Motion made, and Question put forthwith, pursuant to Orders [28 June 2001 and 6 November 2003],
	That the following provisions shall apply to the Housing Bill for the purpose of supplementing the Order of 12th January 2004.
	Consideration of Lords Amendments
	1.   Proceedings on consideration of Lords Amendments shall be completed at this day's sitting.
	2.   Those proceedings shall be taken in the order shown in the first column of the following Table, and each part of those proceedings shall (so far as not previously concluded) be brought to a conclusion at the time shown in the second column.
	
		TABLE
		
			  
			 Lords Amendments Time for conclusion of proceedings 
			 Amendments Nos. 191, 128 Two hours after the commencement of proceedings on consideration of Lords Amendments. 
			 Amendment No. 140 Two hours and 45 minutes after the commencement of those proceedings. 
			 Amendment No. 190 Three hours and 45 minutes after the commencement of those proceedings. 
			 Amendments Nos. 1 to 127, 129 to 139, 141 to 189 and 192 to 284 Four hours after the commencement of those proceedings or 10 pm (whichever is the later). 
		
	
	Subsequent stages
	3.   Any further Message from the Lords may be considered forthwith without any Question being put.
	4.   The proceedings on any further Message from the Lords shall (so far as not previously concluded) be brought to a conclusion one hour after their commencement—[Keith Hill.]
	The House divided: Ayes 291, Noes 165.

Question accordingly agreed to.

Orders of the Day
	 — 
	Housing Bill

Lords amendments considered.

Mr. Deputy Speaker: I inform the House that privilege is involved in Lords amendments Nos. 35, 36, 51, 52, 88, 101, 103, 105, 107, 186, 190, 191, 192 and 202. If the House agrees to any of these Lords amendments, I shall arrange for the necessary entries to be made in the Journal.
	New Clause

Improvements in Energy Efficiency

Lords amendment: No. 191.

Keith Hill: I beg to move, That this House disagrees with the Lords in the said amendment.
	This amendment would place an obligation on the Secretary of State to take reasonable steps to ensure an increase of at least 20 per cent. in residential energy efficiency by 2010. I assure the House that the Government have absolutely no difficulty with the idea that residential energy efficiency should be increased. In debates on this issue in the other place, the Government were accused of weakening their position on that commitment, but I hope to be able to demonstrate the fallacy of that argument. I will also show that the amendment is unnecessary because existing legislation already provides the basis for setting and—just as important—reviewing energy efficiency aims.
	The 2003 White Paper referred to savings of around 5   megatonnes of carbon as an indication of what we thought we could achieve at that time. With the benefit of further analysis, we have been honest enough to publicise a slightly lower figure. The energy efficiency plan of action, published last April by my right hon. Friend the Secretary of State for Environment, Food and Rural Affairs, details measures that will deliver savings of 4.2, rather than 5, megatonnes of carbon in the residential sector.

Brian White: Will my right hon. Friend give way?

Keith Hill: My hon. Friend knows that I am a big fan, but I would like to be allowed to develop my argument a little before I yield to him.
	That figure is based on detailed analysis carried out following publication of the White Paper and reflects changes in economic and technical assumptions that came to light as a result of further work undertaken by DEFRA. So the Government have not sought to pull the wool over people's eyes on this issue. Indeed, the beauty of the figure of 4.2 megatonnes is that, at about 19 per cent., it is very close to the 20 per cent. improvement that this amendment seeks. Achieving 4.2 million tonnes of savings is in fact roughly equivalent to doubling the historic 1990s rate of energy efficiency improvement.
	My right hon. Friend the Secretary of State has declared an energy efficiency aim of 3.5 megatonnes of savings in England, under the Sustainable Energy Act 2003, as a contribution to the UK target of 4.2 megatonnes. The Act enables us to keep our aims under review, and improve on them where we can. DEFRA will consult shortly on the climate change programme review and we will also review our energy efficiency aim in 2007, as well as setting the target for the next phase of the energy efficiency commitment beginning in 2008. In other words, this is a constantly developing scene.
	Savings of 4.2 megatonnes of carbon are not to be sniffed at, and they are not the whole story. The difference of 0.8 megatonnes between the White Paper and action plan figures will be more than compensated for by an increase in projected savings from the business and public sector. We estimate that the measures set out in the action plan will achieve carbon savings of around 12 million tonnes per annum by 2010 across all sectors. That is 20 per cent. greater than the original White Paper figure of 10 million tonnes and by 2010 is expected to save households and businesses more than £3 billion a year on their energy bills.

Tony McWalter: There is much in what my right hon. Friend says, but is he aware that any saving in energy not only saves carbon emissions, but potentially depresses the need for nuclear energy as part of our energy sources? I would be grateful if my right hon. Friend addressed that issue and not simply that of carbon emissions, important though it is.

Keith Hill: I take my hon. Friend's thoughtful point, but I am the Minister for Housing and Planning and I am addressing the issue in the context of housing. Wider issues of energy policy are not for me. I guarantee, however, that his observation will be reported to the Department for Trade and Industry, which has responsibilities in that area.

Simon Thomas: The Minister has tried to claim that savings on carbon emissions from the industrial sector will offset the 16 per cent. cut—it is not a small cut—in the Government's initial target. However, that does not address the issue of fuel poverty and the warm homes initiative. If a 5 megatonnes saving had been the target, it would have provided the opportunity to deliver energy efficiency in the domestic sector with corresponding savings for some of the most deprived in our communities. I would not like the Government to lose sight of that aim.

Keith Hill: I am grateful to the hon. Gentleman for his observation. I assure him that there is no danger of the relationship between energy efficiency and fuel poverty being ignored in the course of our deliberations. In fact, it is my expectation that we will be able to discuss those issues at some length and in detail in consideration of the third group of amendments, which includes proposals on the decent homes programme. He will be aware that we have to make a distinction between issues of energy use and energy loss and issues of income. There is not necessarily a direct and obvious relationship between the two, as I will seek to argue later.

Brian White: In Committee, it was pointed out that there was a discrepancy in the way in which the figure of 4.2 megatonnes was calculated and the Minister who replied agreed to look at it again. What action has been taken to review the figure?

Keith Hill: I am certain that when Ministers make such undertakings they are followed up. I know that my hon. Friend has a deep interest in this issue—as is demonstrated by his legislative attempts—but the picture is shifting and evolving. As the technology changes, the opportunity for delivery occurs. I take his point, however, and I shall seek to ensure that those undertakings were properly pursued. I am sure that they were.

John Hayes: The picture is indeed shifting, but it is important for the House to be clear about it. In the other place, Lord Bassam said that the decent homes programme would reduce carbon emissions by at least 2 megatonnes. The Government's energy efficiency plan for action, however, claims that the decent homes programme will be responsible for 0.05 megatonnes. The position has shifted, but has it really shifted that much?

Keith Hill: Perhaps the hon. Gentleman will permit me two things: to develop the argument in my speech, which is primarily about energy efficiency; and to revert to the decent homes programme in our later exchanges. I am, however, grateful to him for putting the issue on the record. At an appropriate point, I might be better placed to answer it.

Joan Walley: A number of Members are obviously concerned about the amendment. I welcome my right hon. Friend's commitment to further review, but in the light both  of  debates on the Energy Bill and of the Environmental   Audit Committee's recommendations to the Government, will he give the House an assurance that he will find some mechanism in the review to consider what his Department, DEFRA and the DTI are doing so that we can be certain that we have the best possible standards for dealing with energy efficiency as the cheapest, cleanest and safest way to reduce CO 2 emissions?

Keith Hill: I am happy to give my hon. Friend that assurance, and I do not do so in a facile fashion. This is an aspect of genuine joined-up government—to use that familiar and slightly cod phrase. Indeed, I recently met DEFRA Ministers precisely to discuss such issues. Other Ministers were present, as well as representatives from other Departments, so the issues are genuinely being addressed across the board, and I hope that my hon. Friend finds that, at least, reassuring.
	I was setting out certain points about the progress that we have already made on the action plan and the objectives for energy and carbon savings, which go beyond those originally identified in the 2003 White Paper. It is important that those points are put on the record. They have certainly been raised in previous debates, but it does no harm to reiterate them. That is not all. More energy efficiency measures are being backed by firm policy commitments than ever before. I highlight two key measures: we expect condensing boilers to be installed faster under the 2005 building regulations than anticipated in the energy White Paper, and we expect installations of cavity wall insulation to more than double under the next phase of the energy efficiency commitment, which puts obligations on energy suppliers to achieve energy efficiency gains.
	I regard the amendment as well intentioned but unnecessary and inflexible. We are already working towards its objective. Setting a numerical target in primary legislation will not help us to pursue an open, technically sound, evolving approach to the setting of objectives and targets.
	Although I recognise the genuine interest in the issue shown by hon. Members on both sides of the House and have listened to debates in this place and read those that took place elsewhere, I have been struck by the approach of some Opposition Members. Their zeal for the amendment has not been matched by their approach to other provisions in the Bill that would in fact help their case. I am thinking particularly of the home condition reports that will form part of the home information packs under part 5. The EU directive on energy performance of buildings will make it compulsory for home sellers to provide energy efficiency information on their home to potential buyers. That is entirely reasonable. We know that most improvements to homes take place when keen new owners take over.

Edward Davey: I am grateful to the Minister for giving way and I apologise for not being in the Chamber for the beginning of his remarks.
	Does not the EU directive require certification of energy efficiency to be given only when the house is sold and not when the property is marketed? Is not that key to the Minister's proposals for home condition reports?

Keith Hill: We will have an opportunity to discuss those matters and, in due course, I want to go into a little more detail about the inter-relationship of the energy and home condition reports. The EU directive will require an energy report at every point of sale and that will be part and parcel of the home information pack.
	Although the Opposition favour compulsory energy efficiency reports—at least, the Liberal Democrats favour them—they do not support the very means whereby they will be delivered cost-effectively: compulsory home condition reports as part of a compulsory home information pack. Those reports will contain information about the energy efficiency of homes when they are marketed. Compulsory home information packs, with data about the energy efficiency of a property and what a new owner can do to improve it, will capture that moment. Voluntary packs risk frittering that opportunity. We will return to the issue when we debate the next group of amendments.

Lynne Jones: I entirely agree with my right hon. Friend about the mechanisms to improve energy efficiency, but what I cannot quite understand is why he thinks that the 20 per cent. target would be inflexible. If we overshot it and did better, that would be fine, but is not it good to have the target, to fix the Government's mind and to ensure that we reach the minimum necessary to achieve our overall goals? After all, let us not forget that our overall goal is a 60 per cent. reduction in CO 2 emissions by 2050.

Keith Hill: But we are already almost at that 20 per cent. point—achieved by mechanisms that may not have been anticipated even two years ago. When we are moving towards the target, with which my hon. Friend is properly concerned, it seems unnecessary to add this provision to the Bill and set a numerical target, which may be overshot or outdated but none the less adds a degree of inflexibility. Indeed, it might even encourage a degree of complacency. Let us have neither suspicion of the Government's intentions nor encouragement to complacency. Let us not make an unnecessary amendment to the Bill.

Robert Syms: It has been a fair time since we debated these issues in Committee, and one could have predicted that they would come back at this point. The upper House has done us a favour by bringing the matter back to our attention.
	The amendment is not unreasonable. It is not unreasonable that
	"the Secretary of State shall take reasonable steps to ensure an increase in residential energy efficiency of at least 20% by 2010 based upon 2000 levels."
	The Government included that commitment in their manifesto, so it could not have seemed too inflexible then. They said that they would decrease CO 2 emissions by 20 per cent. by 2010 based on 1990 levels. From 1990 to 1997, carbon emissions decreased by 13.1 million tonnes. Since the Government were elected in 1997, such emissions remained almost static, but in three of the past four years they have increased.
	In August, the Environmental Audit Committee reported that the Government's latest forecasts indicated that by 2010 carbon emissions would be 8 million cubic tonnes more than the target—a 25 per cent. shortfall. That target is the Government's target; they have assured the public no fewer than 15 times that it would be the energy efficiency aim set under the Sustainable Energy Act 2003. Some members of the Government have promoted that target. On 17 August, the Secretary of State for Trade and Industry wrote to Mr. J. Card of Hereford:
	"I hope the above helps to convince you that the Government has put in place measures to deliver the expected 5 million tonnes of carbon from household energy efficiency savings."
	The Government's sustainable energy policy network website lists as an objective delivery by 2010 of
	"additional emissions reductions in households of around 3.5 million cubic tonnes . . . beyond those envisaged"—
	that is, 1.5 million cubic tonnes—
	"in the UK Climate Change Programme".
	That equals 5 million cubic tonnes, or the 20 per cent. specified in the amendment. The site also states that it is a Government "commitment" to deliver
	"improvements in household energy efficiency of 5 million cubic tonnes by 2010",
	which is exactly what the amendment says.
	The DEFRA website lists the target under the Home Energy Conservation Act 1995 as a 30 per cent. improvement in 10 to 15 years, using the baseline of 1   April 1996. Taking that as its lowest—30 per cent. over 15 years, based on 1996 levels—it is virtually the same as 20 per cent. over 10 years, as in the Lords amendment. Indeed, the Energy Saving Trust—the Government's own adviser—does not know why the target has been changed to 16 per cent. It has been completely surprised by the sudden decrease and has said so publicly, as it has worked on the policies to achieve the higher figure of 20 per cent. In evidence to the Environmental Audit Committee on 19 May, it said:
	"We were involved in developing the Plan"
	but
	"we have to say that we did not have the final decision"
	in respect of the reduction
	"and we do not agree with it."
	As support for the 20 per cent. target will come from Opposition and Government Members, the real issue is why the Government have decided to change the target. After all, the Lords amendment uses the phrase "reasonable steps". I have served on enough Committees to know that "reasonable" is not an unreasonable word to use in legislation. The target does not necessarily have to be achieved, but the Government must take reasonable steps to achieve it. The Lords amendment is not unreasonable. It would set this country's policies in the context of international relations at a responsible level, and it should be supported.
	I note that early-day motion 96, on the residential energy efficiency aim pursuant to the Sustainable Energy Act 2003, has accumulated more than 340 signatures. Given that Ministers would not sign an early-day motion, two thirds of all the Back Benchers in Parliament must have signed it. I would not suggest that Members of Parliament would sign any early-day motion lightly on such an important matter that has an impact on the future and sensible energy policies. That shows the breadth of support for the 20 per cent. target. The Lords have given us an opportunity to think again, and I hope that the House will adopt a sensible approach and vote for the 20 per cent. target.

Brian White: The Lords amendment is very important, and I agree with the hon. Member for Poole (Mr. Syms) that their lordships have done us a good service by introducing it. Reference has been made already to the Sustainable Energy Act 2003, which I piloted through the House a couple of years ago, and early-day motion 96, so I want to concentrate on what the Government said in opposing the amendment in the Lords last week, which the Minister has just repeated.
	Last week, Lord Rooker said that 4.2 megatonnes is double the historic 1990s level. That is welcome, and we should not lose sight of the fact that there has been a major change. In the energy White Paper, the Government said why the target was important, and they set the aspiration at a 20 per cent. reduction. The problem is that officials began to realise that an historic step change would be required and that a number of issues need to be addressed.
	Lord Rooker argued for flexibility and said that the 2003 Act provides a mechanism to increase the level—it certainly does—but that is not a reason why the Lords amendment, which would set a floor, should not be carried. The Lords amendment would set in statute a floor beneath which Government aspirations should not fall. If the Government want to exceed that baseline, they can use the mechanism in the Act to go way above it.
	The Minister rightly referred to the action plan, which contains many good points; but, again, that does not negate the need for the Lords amendment. The Government have also argued that we are doing well in the industrial and business sector, so we should be allowed to slip in another sector, but this is not a zero-sum game. Our aspiration should be to exceed the level in every sector.
	Lord Rooker also said that the Government have a good tale to tell. The Government are not reneging on their commitments, despite what the Opposition have said, but they are scoring a classic own goal. We have a good tale to tell, but because we are not living up to what we said in the White Paper and we are arguing about 4.2 megatonnes as against 5 megatonnes, we are scoring an own goal for no good reason.

David Taylor: Does my hon. Friend not agree that set as we may undershoot our CO 2 emission reduction targets by about 25 per cent., as reported by the Environmental Audit Committee, to pass up what the White Paper called the cheapest, cleanest and safest way to reduce carbon emissions—energy efficiency—seems perverse, to put it mildly?

Brian White: My hon. Friend makes the key point. Energy efficiency is the best and most effective way to achieve our goals. Whether we are talking about tackling climate change, reducing carbon emissions or taking people out of fuel poverty, energy efficiency is a key policy instrument that the Government must use. By embracing the Lords amendment, the Government would be going with the flow, rather than trying to find a justification for resisting it, when everyone interested in the issue knows that the White Paper provided the right aspiration and the right policy.
	In May, during the debates on the Energy Bill in Committee, the Minister said that the energy commitment would be reviewed in 2007—he has repeated that today—but he also thought that the non-statutory commitment would lead to a substantial stepping up of activity. Unfortunately, that has not been the case. If I am right and the increase has not been sufficient, not holding the review until 2007, with implementation in 2008, leaves very little time to achieve our goals.
	The Minister also said that dialogue with the industry was needed to ensure that the serious disappointment that has been expressed until now does not recur, but that disappointment has been reinforced by the resistance to this very sensible Lords amendment. We have been down this route before with combined heat and power, when we made similar statements with consequences for the CHP industry. We are in danger of doing the same with energy efficiency.
	I have often quoted Bryan Carsberg saying that regulators think that if something is not in the statute, it does not exist. What is true for regulators is also true for officials. Such a proposal has been around for a long time. Indeed, it was part of my original Sustainable Energy Bill. When a ministerial reshuffle took place during the consideration of that Bill, officials said that they would oppose it, although it had been agreed before, and their words are etched on my brain:
	"That may have been ministerial policy, but it is not departmental policy."
	That is the nub of the problem, and those words struck home. If officials do not see something in statute and do not agree with it, it will not happen. There must be a statutory requirement to allow officials to act. That is why the performance and innovation unit's report was so important and why the energy White Paper was so insistent on the 20 per cent. target.
	Everyone agrees that the era of low energy prices, which helped to lift millions out of fuel poverty, is over. We are in a different global environment, so we must consider how to take more people out of fuel poverty. At a recent energy company's annual general meeting, someone said:
	"The consequences for companies that do not act responsibly and take steps to assess and mitigate risks posed by climate change will be just as devastating as the recent corporate scandals."
	What is true for companies is also true for Governments.
	Next summer, the UK will hold the presidencies of the G8 and the EU, and the Prime Minister has rightly made tackling climate change a key objective. Never has the old adage "Think global, act local" been so true. If we do not take on board the Lords amendment, we will negate all the words we use and cause problems at home and abroad. It will give our opponents—whether political opponents at home or countries that oppose the Kyoto protocol—the excuse not to take the action that is desperately needed if we are to take climate change seriously.
	The Prime Minister is right to focus on the international context next year, but we do not need to erect unnecessary barriers, which we will do if we do not accept the Lords amendment. We can hardly criticise the United State if we seem to run away from a sensible amendment. This ought to be a no-brainer, given the list of people who support the target, which includes the energy industry, energy efficiency companies, campaigners from various non-governmental organisation, Friends of the Earth, Greenpeace, the Women's Institute, Shelter and tenants' organisations.
	All the political parties signed up to the proposal—all their green wings have endorsed it—and some 340 MPs from all parties signed up to the aspiration. The wording of the early-day motion was carefully discussed with Ministers and officials, and the figures were checked with officials several times. All of them suggested a figure of 20 per cent, not 16 per cent. The 20 per cent. figure was reaffirmed on 24 occasions, 15 of which were ministerial statements. It was confirmed only a few days before the actual target was announced.
	The Minister says that there is only a small difference between targets of 16 and 20 per cent., so why is it a problem to accept the Lords amendment as a basis on which we can move forward? There is a mechanism by which we can go above the target, but we need a statutory floor. Whatever words the Government use, they will send a clear message by disagreeing with the Lords amendment: the matter is not a priority, and the market need not deliver because slippage is okay. That message would be totally wrong. It would go against everything that the Government are trying to do and all the good things that Departments have done.

Brian Iddon: Does my hon. Friend accept that the all-party warm homes group has taken evidence showing that industry wants to invest in products that would lead to greater energy efficiency? That would create jobs, so there would be a win-win situation all round: we would not only reduce CO 2 emissions and the utility bills of people in fuel poverty, but increase jobs in industry.

Brian White: As I say, this should be a no-brainer. I ask the Minister to rethink his position and accept the Lords amendment. I do not understand why he wants to turn the win-win situation that my hon. Friend described into a no win situation in which we would be accused of reneging on commitments. The story that we have to tell is good, and we have made excellent achievements, so we need to seize the opportunity of achieving a long-held Labour aspiration. We should not give our political opponents a stick with which to beat us, or erect unnecessary barriers that would hinder next year's G8 negotiations.

Matthew Green: The Minister described the figures as a shifting, moving picture. The shifting and moving has been on the Government's part, because they have moved from their stated target of 5 megatonnes of carbon down to 4.2 megatonnes. He says that that would result in a 19 per cent. target on carbon rather than a 20 per cent. one, and asks what everyone is getting so worked up about. I suspect that the figure is closer to 18 per cent. than 19 per cent.—

Alan Simpson: It is 16 per cent.

Matthew Green: Well, the reduction would be 16 per cent., but the Minister said that the overall effect would be equivalent to a 19 per cent. target. However, if the difference between the targets is so small, why will the Government not agree to the 20 per cent. target? Why is a target of 19 per cent. more achievable than one of 20 per cent.? The Government must know something that the rest of us do not. There must be a reason why a 19 per cent. target can be achieved easily, but 20 per cent. is out of reach. I am struggling to understand what that is, so when the Minister winds up the debate, I hope that he will set out why the Government are confident that they will meet the 19 per cent. target, yet fail to meet 20 per cent. The projections that his officials are making must be really tight to enable him to reach that conclusion.
	By my count, at least 150 Labour Members signed the early-day motion—[Hon. Members: "Over 200."] I am   being told that the figure is more than 200. [Interruption.] Well, the bigger the number gets, the more uncomfortable the Minister looks. I hope that the Labour Members who signed the early-day motion will back that up with their votes.
	There is a lot of good in the Bill—[Interruption.] There are some bad things as well. However, as there is a lot of good in it, we do not want to descend into a process of ping-pong between the Lords and the Commons. The easiest way for us to avoid that would be to accept the Lords amendment. If Labour Members were to stick to their guns, we would not have to send the Bill back to the Lords because we could pass it now. That would get the Minister out of a bind, because it would make the Whips happy if we did not get into ping-pong. The Minister used to be a Whip, so he knows all about that.
	Hon. Members have posed good questions already, yet the Minister made great play of the fact that the target in the amendment is only just above the Government's proposal, but if there is such a small difference, the higher target must be achievable, unless he knows something that the rest of us do not. It is very strange for the Government to say that we should resist the amendment because we will get awfully close to the target in it anyway, but that is essentially the position that they have adopted.
	I hope that the Minister will make the difference between the targets clear and explain why there is so much at stake that he will resist the amendment. Energy efficiency has been described as one of the Government's key objectives, and proposals have been made by the Cabinet Office performance and innovation unit, so there is clearly support for it high up in Government. The Government's Sustainable Development Commission has used the 20 per cent. figure, and we have heard that it has been cited in letters even recently. I do not understand why the Minister is resisting the amendment. The hon. Member for Milton Keynes, North-East (Brian White) described the decision as a no-brainer, so the Minister must come clean and tell us what is at stake if we change the target from 19 to 20 per cent.

Alan Simpson: We need to put the debate in the context of the best aspects of the Government's record. For the first time in history, the Labour Government gave a statutory undertaking to eradicate fuel poverty in this country by 2016. The Government and the Labour party should rightly be proud of that awesome commitment. Equally, the Prime Minister made it clear to the House that meeting Britain's Kyoto targets was a statutory and binding obligation. He has also said that addressing the challenge of climate change will be the centrepiece of the next Labour Government, so the amendment should be at the heart of what Labour has tried to stand for: taking people out of fuel poverty while meeting our broader global obligations to tackle climate change. It is thus bizarre and somewhat absurd that the Government refuse to endorse the targets in the amendment that successive Labour Ministers have affirmed as Government policy. We are having an "Alice Through the Looking Glass" debate that has been constructed by officials in the Department for Environment, Food and Rural Affairs, rather than Labour Ministers or the Labour party.
	The reduction of the carbon target from 5 megatonnes to 4.2 megatonnes has been justified on the ground that it was done on the basis of the best available evidence at the time. People have asked the nature of that evidence and where it came from, but it has not been adequately justified. Our advisers, the Fuel Poverty Advisory Group, said that it was at a loss to understand why the Government wanted to introduce a lower target. I think that in this Bill, as in those that have preceded it, civil servants have been faced with the prospect of targets, but rather than asking how they can meet them, they have asked how they can lower the hurdle. They want to know how they can appear to be meeting Government targets without breaking a sweat. There is a conflict not between different parties in the House, but between the House—it knows the policies that came from the Government—and the civil servants who have the job of writing measures to deliver and implement Government policy. They should not rewrite such policies to give themselves an easier life while leaving everyone else with bigger problems.
	The Minister understandably rebuffed the question of whether that would contribute to our ability to choose not to go down the nuclear path by saying that it was not in his remit to address energy industry issues because we are merely discussing a Bill on housing. That is perfectly fair. By the same token, however, he cannot try to shelter from reducing carbon savings as a result of improving household energy efficiency by saying that other savings would be met and exceeded in other parts of industry. We made specific commitments in relation to the housing sector and it is against those commitments that we are being asked to define a position in the Bill.
	Hon. Members have counted the number of Labour MPs who signed the early-day motion, with different results.

David Taylor: It is 229.

Alan Simpson: It seems that the figure is now 229.
	Someone said that it is hard to find a loser, but there are 230 potential losers—the 229 Labour MPs who signed the early-day motion in good faith and the country. Those commitments are not abstract figures. They will affect the quality of life of the most fuel-poor people in the country. The Government need to accept that the challenge that faces us is to stand by the commitments that we have made.
	In a letter on behalf of the Department for Environment, Food and Rural Affairs dated 28 October, Alan Clifford of the sustainable energy policy division wrote to Mr. Robson, chair of the Association for the Conservation of Energy and a member of the Government's Fuel Poverty Advisory Group, in an attempt to rationalise why the lower figure of 4.2 million tonnes of carbon emissions was being set. He said:
	"the White Paper figure was based on the best information available at the time, and was not a target."
	Unfortunately, we are getting into the realms of pantomime. Civil servants may consistently say that the figure was not a target, but other voices in the background say that it was. The Labour manifesto said:
	"We will lead the fight against global warming, through our target of a 20 per cent. reduction in carbon dioxide emissions by 2010."
	So that target was defined in the manifesto.
	The letter went on to say that the energy efficiency action plan, published in 2004, reduced the target to 4.2   million tonnes because that was deemed to be the appropriate figure. So the 5 million tonnes was not a fixed figure. However, when the hon. Member for Truro and St. Austell (Matthew Taylor) asked the Prime Minister:
	"Will he make it clear that there is no truth in the interpretation that has been put on the comments of some Ministers that Britain will stick to the new Government's 20 per cent. target for cuts to CO 2 emissions only if other countries co-operate in cutting their emissions? Will he confirm that our target is not conditional on the action of others?",
	his response could not have been clearer. He said:
	"It is not a conditional target".—[Official Report, 24 June 1997; Vol. 296, c. 687–88.]
	We have targets that are defined as unconditional; targets that are defined as a quantum; targets that are defined by a succession of Labour Ministers; and targets that are endorsed, approved and supported by 229 Labour Members. I suspect that the overwhelming majority of local authorities, non-governmental organisations and everyone who works in the environment and fuel poverty sector all envisaged us setting and standing by our targets. The question that will baffle the public is why on earth we would want to renege on them now.
	The Minister said that there was a danger that setting the target would create a mood of complacency and we would be held back, but the final paragraph of Alan Clifford's letter nails the lie of that when he says:
	"it has always been recognised that additional measures might be needed to achieve the domestic goal of a 20 per cent. reduction in carbon dioxide emissions below 1990 levels by 2010."
	By setting the lower figure of 4.2 million tonnes, there is a calculated level of under-achievement in which officials recognise that the Government will be forced to identify other measures. Why do we build in a guarantee of failure to meet the targets that we have set for ourselves when it is within in our reach to do so and to stand by the commitments that we made?
	Hon. Members are right to say that the energy efficiency industry waits for us—pleads with us—to set those targets, which it will meet. It is incomprehensible that the Minister asks the House to set lower standards when our original targets are within our reach and we should stand by them. I am not asking him to do a Dolly Parton and stand by our man, but I am asking him to stand by our manifesto, which would be welcomed by the public and the party.

Sydney Chapman: I shall be brief because I agree with every word my hon. Friend the Member for Poole (Mr. Syms) and the hon. Members for Milton Keynes, North-East (Brian White), for Ludlow (Matthew Green) and for Nottingham, South (Alan Simpson) said. I declare a possible non-financial interest. For many years, I was a qualified architect, but for much of that time I was off the drawing board and now receive no income from my erstwhile profession. Indeed, I said in Committee and before that I have a reverse interest to declare because for years I paid professional subscriptions to the Royal Institute of British Architects to no avail.
	I feel a sense of sadness about the proposal. I honestly do not think that there was any need for the Government to resile from their commitment to improve energy efficiency by 20 per cent. by 2010 on 2000 AD levels. They have made a tactical mistake, and I shall set out why. As hon. Members have said, they repeatedly assured us that that target would be set. My hon. Friend the Member for Poole said that they repeated that 15 times. The target has got into the public psyche, which is good and heart-warming. It has also been fully supported by the Energy Saving Trust, the Sustainable Development Commission, the Government's official advisers and at least two other Departments—the Department of Trade and Industry and DEFRA. I cannot understand why the Office of the Deputy Prime Minister has suddenly decided to revise it.
	The plan is to save 4.2 megatonnes of carbon rather than 5 megatonnes. That is a reduction of 16 per cent., which is significant. However, as other hon. Members said, the revised target means that we will hit only a 19   per cent. overall improvement in energy efficiency instead of 20 per cent. by 2010. Overall, the House supports the Government in the early-day motion that has been tabled. I hope that the number of Labour Members who support the proposal does not increase, as that detracts from the all-party nature of the issue, for which there is general support. I shall not be here in 2010, but if I am correct, my colleagues, whether they belong to the Government or the Opposition, will not feel a sense of triumph if the Government fail. There will be a sense of sadness, combined with respect for the fact that the Government kept to their original target. Even at the 59th minute of the 11th hour, I beseech the Minister, for whom I have a very strong regard, to change his mind or seek to persuade the Government to do so.
	In conclusion, the Government have set myriad targets—some people may say too many—throughout the field of government. I am a member of the Public Administration Committee, which produced a report on Government targets. We may have complained that there are too many targets, some of which contradict others, but we have never suggested that pinpointed targets are anything other than a good thing for the Government to try to achieve. If the Government do not accept the Lords amendment, which was tabled by Baroness Hanham on 3 November, they will detract from the efficacy of their target-setting policies. I beseech the Minister, who represents Streatham—I must remember not to say "St. Reatham"—to reconsider his position, as he will win tremendous all-party support not only from hon. Members but from the public at large, persuading them that we take the issue of energy savings and energy efficiency very seriously indeed.

Joan Walley: I shall make a brief speech, as I hope that in his reply the Minister will take on board the many points made by Members on both sides of the House.
	I religiously signed the early-day motions because I believed in them and in the original target. We must be careful not to devalue targets by suggesting that a target that cannot be met provides a perverse incentive and   undermines the system. Many hon. Members passionately want the original target to be met and to be applied to energy efficiency. My hon. Friend the Member for Milton Keynes, North-East (Brian White) set out our aims clearly, and I urge the Minister to persuade the Government to address the reports and debate on the issue. If the target cannot be included in the Bill, will he give us an assurance that we can meet what we set out to achieve—the basic floor target of 20 per cent. savings?

Tony McWalter: I am sure that, like us, the Minister is strongly in favour of abolishing fuel poverty and meeting achievable targets on insulation with a hard-working programme. I do not believe that that is at issue. However, I would like to know why he believes that it is inappropriate and wrong to include the 20 per cent. target in primary legislation. Does he fear, for instance, that the Government could be taken to court gratuitously if the Lords amendment is accepted? Would a lot of legal time be taken up defending slow-burning Government programmes? Why does he agree with everything that has been said in favour of the target, but object to its inclusion in primary legislation?

Bill Tynan: I will not delay the House long, as I merely seek clarification.
	It is obviously difficult for the Government to change their mind. Had the Bill received pre-legislative scrutiny, they might have been able to do so. However, once a Government have decided to push through a measure, it is usually impossible for them to change their mind.
	I have just one question for the Minister. The Lords amendment says that
	"the Secretary of State shall take reasonable steps to ensure an increase in residential energy efficiency of at least 20 per cent. by 2010 based upon 2000 levels."
	Will the Minister clarify the Government's position? Is it that he supports the target but does not want to include it in the Bill? His reply will help hon. Members who signed early-day motion 96 to consider their position before voting against the Government.

Keith Hill: Let me provide immediate assurance to my hon. Friend the Member for Hamilton, South (Mr. Tynan) that the Government support the 20 per cent. target and, indeed, as I have argued, we are in the process of meeting it.
	I am alarmed by the tone taken by some of my hon. Friends. There is no hidden agenda or conspiracy. May I tell my hon. Friend the Member for Nottingham, South (Alan Simpson) that the Government have not reneged on their commitments—we are delivering on them, as I have previously said, and as I shall go on to demonstrate. I respect the expertise of my hon. Friend the Member for Milton Keynes, North-East (Brian White), who protested that we have not accepted the terms of the amendment, even though, somehow, we have already agreed to its substance in legislative form. We have not done so, but we are not withdrawing or resiling from our commitments. To be entirely accurate, the figure of 5 million tonnes of carbon savings in the residential sector was never the Government's stated aim, but an initial indication in the energy White Paper of what could be achieved. However, our record stands in its own right. The 4.2 million tonnes of carbon savings that have been mentioned in our debate represent a significant increase in activity on current levels, and will require a major increase in delivery by the industry. Our latest calculations indicate that that total corresponds to an increase in efficiency of about 19 per cent. compared with 2000 levels.

Anne Campbell: Will my right hon. Friend give way?

Keith Hill: No, I am afraid that I do not have time.
	We expect a significant increase in overall carbon savings from energy efficiency. The energy efficiency action plan details measures to make estimated carbon savings of 12 million tonnes of carbon—a 20 per cent. increase compared with the rough figures in the energy White Paper, which predicted savings of 10 million tonnes of carbon to 2010. I repeat, therefore, that we are genuinely succeeding in meeting our energy efficiency targets, so the Lords amendment is simply unnecessary. There are no grounds for doubting the Government's commitment and we are getting there by making carbon savings across the board.
	My hon. Friend the Member for Hemel Hempstead (Mr. McWalter) raised the relationship between energy efficiency targets and fuel poverty. He will know that that relationship, about which colleagues and I share serious concern, is not unilateral. We will have an opportunity to debate it later this evening, but I remind him that measures in the energy efficiency action plan play an important part in combating fuel poverty. As he and the House will know, there has been a steady reduction in the number of households in fuel poverty, which we can discuss in more detail later. However, I remind the House that the fuel poverty action plan for England, which will be published later this year, will set out how the Government expect to meet the target of eradicating fuel poverty in vulnerable households by 2010. I therefore invite the House to disagree with the Lords amendment.

Question put, That this House disagrees with the Lords in the said amendment:—
	The House divided: Ayes 259, Noes 186.

Question accordingly agreed to.
	Lords amendment disagreed to.

Clause 137
	 — 
	Duty to have a home information pack

Lords amendment: No. 128.

Keith Hill: I beg to move, That this House disagrees with the Lords in the said amendment.

Madam Deputy Speaker: With this we may discuss Lords amendments Nos. 130, 135, 137, 143 and 144 and the Government motions to disagree thereto.

Keith Hill: It is a matter of great regret to me that the issue of home information packs has remained so contentious between the parties, especially when there has been such broad consensus about the Bill and we have been able to work so well together. That applies not least to work between the Government and the Liberal Democrats in improving the Bill, especially the provisions on empty homes and tenancy deposits.
	The amendments would replace a compulsory home information pack scheme with a voluntary one. The notion of voluntarism is seductive and there was much talk in the other place of the reforms being an unjustified restriction on people's right to buy and sell homes as they please in a market that functions perfectly well as it is. However, those of us who inhabit the real world know that that is not the case. The home buying and selling process does not function properly. Hundreds of thousands of people every year are put through the wringer because of the inadequacies of the current system. Hundreds of millions of pounds are wasted on transactions that get nowhere. That is money that ordinary, hard-working families can ill afford to lose.
	Three out of 10 sales fall through between offer acceptance and exchange of contracts and more than half of all sales experience some sort of problem during that period. It is no wonder that, whenever they are asked, people say that they are hugely dissatisfied with the current system. Nine out of 10 people said that in one independent survey last year. That is hardly a ringing endorsement for a system that is supposed to work well.
	I do not doubt that some people are doing very nicely out of the system. Every cloud has a silver lining and the abortive costs to consumers from all those failed transactions represent a nice little earner for others. Needless to say, they are not the people for whom the reforms are designed, although many in the industry welcome what we are doing and are keen to get on with it. For them, the reforms are overdue and liberating, enabling them to offer the sort of service that their customers want.

David Kidney: Will my right hon. Friend give way?

Keith Hill: Of course I shall give way to my guru on home information packs and so much else.

David Kidney: Surely my right hon. Friend does not suggest that the lawyers and estate agents who object to the home information packs are the ones who benefit from an inefficient system.

Keith Hill: As I was wont to say in my previous incarnation as deputy Chief Whip, my hon. Friend may say that but I could not possibly comment.
	Opponents of compulsion should recognise that relying on voluntarism would mean things staying much as they are. That is because a voluntary HIP system will not achieve the universal acceptance needed to make it work properly. The amendments are really about removing part 5 from the Bill, thus leaving the housing market unreformed and damaging not only to individual buyers and sellers, but to the national economy. Too many people are disadvantaged for us to ignore the problems and settle for the status quo. We are determined to offer consumers a genuine prospect of change. That cannot be done through relying on voluntarism and good will alone.

Peter Bottomley: Will the Minister give way?

Keith Hill: I shall, but I have much to say and relatively little time in which to say it. I also want to allow other hon. Members to speak.

Peter Bottomley: The Minister is trying to reverse a Lords amendment and get the House's approval for that and I am grateful to him for allowing me to ask a question. If I approach someone who is not planning to sell a home and ask them whether they will sell it to me, is it lawful for them to do that without providing a home information pack?

Keith Hill: The answer to that is an unqualified yes.
	Of course, there are a few agents who have sought to progress on the basis that I have described. They report none of the dire consequences predicted by the Opposition, although they are frustrated that others can reap the benefit of their efforts without having to do very much. In a buoyant housing market, that is not surprising. In a downturn, they might need to work harder, but unless they pull in the same direction, more effort can be ineffective.
	All markets work most efficiently when all the parties are well informed, and the housing market is no exception. Nobody disputes that. The home information pack will deliver that for home buyers and sellers. We do not need a Bill just to have a voluntary system of home information packs. Sellers and estate agents are free to provide them now if that is what they want. However, despite the evidence that they can greatly reduce the chances of transaction failure, they have not gained a sizeable foothold in the home buying and selling process. There are very good reasons for that.
	The main problem with a voluntary scheme is chains. If any link in the chain is without a pack, the whole chain would suffer if that were to be the cause of problems. If packs are not made compulsory, one individual who decides to opt out can wreck the process for everyone else. We also know that estate agents in the high street are fiercely competitive, and without compulsion, most of them will be tempted to offer the easy option. Without the level playing field that a compulsory scheme will bring about, most estate agents, even those sympathetic to HIPs would look at what their competitors were doing and would not act for the greater good of consumers if they felt that it would put them at a commercial disadvantage.
	There have been accusations that the introduction of compulsory HIPs will mean a huge reduction in the number of properties going to the market and that that will result in massive house price inflation. That would be scary if it were true, but it is just the usual scaremongering. The introduction of similar changes in Denmark and New South Wales had no effect on the market. That view is also supported by research commissioned by the UK's largest estate agency group—the Countrywide group—which suggested that there would be little impact on the number of homes sold. The Countrywide study found that, even if sellers had to pay up front for the pack, 87 per cent. would still offer their home for sale. It concluded that the pack would take out of the market only the people who were not serious about selling anyway.

Simon Thomas: According to my understanding of the proposals, the Minister will decide at what stage to commence this part of the Bill. Will he tell us how he would do that, because that decision would have an impact on the market? Will he introduce the provision throughout the United Kingdom overnight, or will it be piloted in certain areas—perhaps in Wales; why not?—and what ideas does he have about ensuring that it will actually work?

Keith Hill: The hon. Gentleman has been a good supporter of this proposal, and he is articulating a reasonable concern about its implementation. After all, there are few things in life more important than a person's home and their acquisition of it. I can give him an absolute assurance that we shall not bring this system in until we are absolutely clear that it is going to work. We envisage various kinds of dry run to ensure that it is working properly and I hope to talk about that in due course, in a way that I hope he will find helpful.
	I was saying that there had been accusations that the introduction of compulsory HIPs would mean a huge reduction in the number of properties going to the market, and that the evidence was that there would be no such reduction. Indeed, I pray in aid on this matter no less a figure than Kate Barker of the Bank of England's Monetary Policy Committee, who has spoken about the problems of the current home buying and selling system and about how HIPs will help. In her recent report on housing, she said:
	"An efficient housing market depends on buyers and sellers having available to them accurate and comprehensive information about individual properties as early as possible. This is often not the case at present, and as a result many transactions fail or take longer than necessary."
	She went on to say that HIPs would address that market failure and should reduce the risk of transaction failure and speed up the buying and selling process, provided that they were properly researched with the industry and consumers. We certainly intend to do that. She finished by saying of HIPs:
	"I welcome the greater transparency that they are expected to bring, and would not anticipate that there will be an impact on house prices as a result of their introduction."

John Butterfill: Will the Minister tell me what particular expertise Kate Barker has in the home buying and selling markets?

Edward Davey: She is a macro-economist.

John Butterfill: She is, but I do not know whether she has any great expertise in this area.

Keith Hill: If the hon. Gentleman had read Kate Barker's report on housing—he might well have done so—which was commissioned jointly by my Department and the Treasury, he could not have helped being impressed by her deep understanding, the great extent of her expertise and the enormous trouble that she took to analyse the housing market and to get these things right. I do not know which authority the hon. Gentleman wants to promote in opposition to Kate Barker but, frankly, I am content to rest on her judgment that this system would not impact on house prices in any negative sense, and that it would make the housing market more efficient.
	The provision of more and better information cannot help but improve the functioning of the housing market, although I do not pretend that it will solve every problem. We accept that our proposals are not a panacea. However, every examination of these problems by Governments over the past 30 years—and there have been a number, in case anyone is labouring under the delusion that these are new problems—has concluded that this would be the most helpful change. My noble Friend Lord Rooker listed some of those conclusions recently in another place. There was the Law Commission report on subject-to-contract agreements, which was laid before Parliament as long ago as January 1975. Then there was the first report of the Conveyancing committee in 1984, better known as the Farrand report. The previous Conservative Government's report, "Survey of options for simplifying the house purchase process", published in 1993—I presume under the auspices of the right hon. Member for Suffolk, Coastal (Mr. Gummer), who is in his place—responded to concerns about inefficiencies in the market and concluded that sellers should provide property details at the outset and that conveyancers could reduce the uncertainties of chains by encouraging a greater disclosure of information.
	None of this is new. The problems are not new and the solutions are not new. What is new is that we now have a Government who have the courage to do something about it, even if that means upsetting a few interests along the way. While I am on the subject of interests, let me draw to the attention of the House a couple of interests that have recently come out in support of the Government's proposals. As a Labour man, I have been reading The Guardian devotedly for more than 40 years, although nowadays, opening my copy often feels like a somewhat masochistic exercise. To my delight, however, I saw that the editorial in the edition of Saturday 6 November contained a most enthusiastic expression of opinion in support of the Government's proposals on home information packs. And, lo and behold, in The Times of Friday 5 November, the excellent Susan Emmett, its deputy property editor also wrote enthusiastically about the ending of what she described as "this tortuous process" of home sale and purchase. If I had more time, I should certainly draw these serious observations to the attention of the House. I shall spare hon. Members that experience now, although I might get the opportunity to do it later. I will simply say that when the muesli and sandals brigade lines up with "The Thunderer" in joint support of the Government's proposals, those proposals must be taken very seriously.
	Unlike the Opposition, we have a coherent view of what is needed to create a sustainable housing market. Apart from making an effort to balance the supply and demand for housing responsibly, we want to ensure that the existing stock is maintained and kept in good repair for future generations. We want to see people taking responsibility for their stewardship of the housing stock, including its upkeep and energy efficiency. They can do that only if they have the necessary information at the right time and in the right place.

John Gummer: The Minister mentions energy efficiency. I wonder why. My concern is that the Secretary of State is taking powers whereby he "may" do this, that or the other. Why did he not state categorically from the outset that he would institute a mechanism whereby the proper energy efficiency rating of every house could be presented, enabling people to make a comparison?

Keith Hill: The right hon. Gentleman entices me on to the next phase of my exposition of the virtues of our proposals, but I am surprised that he, as a good European, is unaware of European Union directive 2002/91/EC, which makes such an energy efficiency report mandatory.

John Gummer: I was inviting the Minister to explain why the Secretary of State did not take credit for this, as is his wont, by getting it in the original documentation.

Keith Hill: The right hon. Gentleman will have to put that down to my innate modesty. After all, he will acknowledge that I have not attempted to replace the concept of the Gummer exception with the Hill exception. This is a rather arcane exchange, albeit one that we have both enjoyed.
	The Opposition have failed to make any link between their laudable demands for more and better use of the existing stock in creating sustainable communities, including higher energy and other standards, and the crucial role that HIPs will play in achieving those ends.
	As I was saying to the right hon. Member for Suffolk, Coastal, we shall have compulsory energy surveys when properties are sold; the EU directive to which I alluded requires that. It is entirely consistent with the primary need to use energy supplies more efficiently and is something that the Opposition fully support, but they clearly have difficulties with the means.
	Let me take the House on a tour of some questions that need to be addressed to meet the energy certification requirement and the information that the inspector carrying out the survey will need to gather as he or she goes around a property to complete the energy report. The questions include: is it a flat or a semi-detached, a mid-terrace or detached house? When was the property built? Are there any extensions or modifications, and when were they made? What are the walls in the main property or any extension constructed from? Is there any evidence that the walls have been modified, possibly with cavity fill insulation or external insulating render? What is the floor construction? What types of window and glazing are installed? What is the roof construction? Is there a porch or a conservatory or a basement; if so, how big is it, and can it be closed off from the main part of the house and does it have a separate heating system?
	For each storey of the property, the inspector needs to measure the floor area, the room height and the length of wall through which heat can escape either to the outside world or into unheated spaces such as a garage, and the area of windows, doors and rooflights.
	I put it to the House that this is already starting to sound like a fairly sophisticated assessment, but the requirement goes much further because the following questions must also be addressed: what type and thickness of insulation is there in any loft space? Is there gas or electricity available in the property or in the street? What ventilation rate can be expected in normal circumstances? What space and water heating systems are installed? What controls are there on those systems?
	This is not just a question of, "Is it a gas central heating boiler or not?" Instead, the requirement is to determine whether it is a standard boiler or a combination boiler, and whether it is a condensing boiler; how efficient it is; and whether there is a timer, a room thermostat or thermostatic radiator valves. That assumes that the system in question is a straightforward gas system, but it can get a lot more complicated if it is not and the means of heating is from other fuels or local heaters rather than central heating.
	Undertaking an energy efficiency assessment is a skilled task, requiring a qualified individual to look at all the key elements of the property such as walls, floor, roof, glazing, space and water heating, and services—in fact, pretty much every element that we are proposing should be considered in the home condition report.
	The time required on site to perform an energy efficiency assessment using the reduced data standard assessment procedure methodology would be an hour to an hour and a half, with a relatively short period for subsequent preparation of the report. That compares with an anticipated two hours on site to undertake a full home condition report, plus up to an additional hour to write up the report.

John Butterfill: The Minister is being very generous in giving way, but I am not sure that he fully understands what is likely to be involved in such a report. I speak as a chartered surveyor. To cite an example that occurs frequently, if a building has tile hanging on the exterior, there should be some insulation between it and the plaster walls on the inside—an older property may have lath and plaster—but it is not possible to tell without removing either some tiles from the exterior or some plaster work from the interior whether there is any suitable insulation material between them. That would require considerable work and a labourer on site, and the damage would have to be made good. Even that one element of the report could not be completed in an hour and a half.

Keith Hill: It is perfectly clear that the work that has to be carried out for the energy report and inspection is very much akin to that which needs to be carried out for a home condition report. It is, effectively, a medium-level survey. Quite frankly, it is a sight better than the drive-by survey that is so often done by those who carry out surveys and valuations. I accept, of course, that more detailed work is required in some circumstances, but I make the point that we already have a compulsory system of energy assessment, which will require little by way of add-on—in terms of what needs to be looked at or time—to produce a home condition report.
	How long would it take to finalise a stand-alone energy report? We think it would take three to five days—the same time as we expect it to take to get a home condition report and, indeed, assemble the whole pack. So, frankly, the Opposition are offering no time savings. This would also scupper the possibility of first day marketing—another Opposition shibboleth—given that the energy survey has to be made available to enable potential buyers to make comparisons with similar properties.

Edward Davey: The Minister has spoken in some detail about what would be in such an energy audit, but will he go to the key point? The directive requires that to be done by the time the property is sold, not at the point of marketing. That is the difference between the parties, I believe. We have no objection to energy audit being compulsory and having to be done before sale—that is what the directive requires—but producing a system under which all has to be done before the house is marketed is the genuine big problem here. It will cause so many difficulties in the housing market.

Keith Hill: It seems to me that the hon. Gentleman really is splitting hairs. The fact of the matter is that the work on the energy report has to be done in any circumstances. It has to be done by the point of sale. Why not? What reason is there not to conduct that exercise at the beginning of the process? After all, presumably nobody knows exactly when the point of sale will be. There is absolutely no reason for that work not to be done.
	One corollary of the home condition report system is that the period of sale will be considerably reduced because all the information that is required and which takes time to acquire in a normal house sale will be provided up front. So, it seems to me that the hon. Gentleman is not raising a significant reservation.
	I am aware that I have spoken for some time, so I want to deal with some issues that have been raised and perhaps come back to offer assurances of the sort that the hon. Member for Ceredigion (Mr. Thomas) is looking for. The question is often raised that this is an unreasonable imposition on the house seller and those involved in the process. An energy report is essential, but how much will that cost? The industry estimates that a free-standing energy survey will cost at least £150, yet for another £150 sellers and buyers could have a full home condition report and thereby help to solve the problem of the 43 per cent. of failed transactions that result from an unfavourable survey. I would say that that is a good deal, and I firmly believe that buyers and sellers would agree if they were told the facts as distinct from the fiction.
	I keep reading, and the Opposition keep stating, that these provisions will force every house seller to pay £1,000 for a pack. Never mind that the cost is nearer £650, of which £300 will buy the seller the full condition report, including the energy assessment—and never mind that many of the costs are incurred now. What about the benefits? There will be savings to the buyer from fewer mortgage lenders' valuation inspections—exactly how many fewer we do not yet know, but those are commercial decisions that lenders will take in the light of their confidence in the packs and their own plans.
	We should not forget that the market is likely to drive down costs. The price of HIPs will be driven down by competition. Last week, Rightmove, members of whose property portal site make up half the entire estate agency market, announced that it is gearing up to provide at least 500,000 packs a year from 2007. That is not far off a third of the total requirement for packs—and that is from just one company, albeit one backed by the Halifax, Countrywide Assured, Connells and Royal Sun Alliance. We know that other players have similar plans.
	A number of independent agents have expressed interest in the Rightmove initiative. Critics of our proposals suggest that small estate agents stand to lose out under HIPs, yet here is an example of an initiative that will provide packs for the whole industry, including small agents.
	The House will be aware that I have announced that our aim is to introduce these reforms in January 2007. However, I have also made it plain that the reforms will not be implemented until everything is in place and ready to go. We will, of course, take our lead from the industry on that. In that respect, our proposals for a dry run of the home information pack will help everyone to judge the readiness of the market.
	To help to ensure a smooth and successful introduction, the Government intend to facilitate a dry run of the full HIPs scheme on a voluntary basis throughout England and Wales from mid-2006. During the dry run, all the components of the statutory scheme will be available for the industry to test and make ready their systems ahead of the introduction of the compulsory scheme. We regard that as a crucial part of our implementation strategy. With the industry, we will closely monitor the dry run and identify any problem areas. If necessary, any problems will be addressed through regulations before the national scheme commences. The flexibility built into the Bill ensures that that can be done quickly.
	It was suggested in the other place that the dry run should include a compulsory element in a designated area. Again, the provisions of the Bill are sufficiently flexible to allow that approach. I am happy to consider that further with the industry.
	We have no intention of rushing headlong into this with our blinkers on and without any regard for whether the market is ready and the new system works. There is no basis for that sort of accusation, which has been made on other occasions. We are flexible on the issues that several Members have raised, such as the implications of the new compulsory system for low-value homes and for people who are moving out of home ownership, such as the elderly, who will not gain directly from a HIP prepared on another property. There will be open and frank discussion about such matters before the final shape of the scheme is settled.
	The housing market is not functioning properly. Consumers—buyers and sellers—want change. We have said that we will deliver that, and have confirmed it in two general election manifestos. The changes cannot be delivered on the scale that is needed under a voluntary system. Compulsion may be regrettable, but in this case it is necessary.

John Hayes: I have seldom heard a Minister expend so much energy so inefficiently. For half an hour, the Minister for Housing and Planning regaled us with his accounts of the glories of home information packs, without addressing a single argument that had been made persuasively by Liberal Democrat peers—I do not often say that—Cross Benchers and, most notably, Conservatives in the other place. The truth is that home information packs, or sellers packs, as they have become known, are not needed and not wanted.
	Let me reciprocate the generosity that the Minister displayed at the beginning of his remarks. It is true that the Bill includes many good proposals, and we discussed some of those at length in Committee, but this proposal is not one of them. Extraordinarily, it is against all advice, and the Opposition parties are united on this, although I demur from including the Welsh nationalists, who, I understand, at least from what the hon. Member for Ceredigion (Mr. Thomas) just signalled, are on the fence.
	The other place debated the proposal at great length, and peers of all parties both voted for the amendment and made the case against the Government's position. Despite what the Minister says, there is no widespread demand for sellers packs from buyers and sellers. The only people whom he could cite in support of his contentious—I say that advisedly—proposals were people in New South Wales, people in Denmark and Kate Barker, who was doing the Government's bidding anyway. She was hardly likely to come out and say that they were wrong, when she was commissioned by them to say that they were right. The evidence that the Minister has brought before us is not in any way convincing.

David Kidney: Perhaps my right hon. Friend the Minister was therefore remiss in not repeating, as he did in Committee, that the Consumers Association is a strong supporter of the proposal on the grounds of consumer protection. Is not this proposal necessary to ensure that everybody who buys a home gets the speediest possible service and all the information that they need before signing a cheque for a whacking great price for their house?

John Hayes: I will address both those points, on speed and the quality of information that people receive, in my brief remarks. The hon. Gentleman's point on the Consumers Association is a fair one, and as ever, he makes a good argument. It is a great pity that the Minister, in the full half an hour for which he spoke, was not able to cite it himself, as it was considerably more persuasive than any that he made.
	The Minister said that the sellers packs are in response to popular demand, and that the market is not working. I am not convinced. The amendment goes to the heart of the contention over sellers packs. What is the position of the other place, and what is the Government's position? The Government say that everyone will be obliged, by law, despite the run-in period to which the Minister refers, to spend up to £1,000 when selling a house, regardless of the value of that house. In return, they will gain a sellers pack. Let us imagine someone who puts a modest house worth, say, £60,000 or £70,000 on the market, and who must then withdraw it from the market and re-market it some time later. We have no assurance from the Minister that the sellers packs will last any great time. We are told, as the other place debated at some length, that they may be valid for as little as three months. In the scenario that I just described, the person would have to purchase two sellers packs costing up to £2,000 for the sale of a £60,000 house that they might not sell anyway.

John Gummer: Has not my hon. Friend noticed that the Minister prayed in aid the perfectly reasonable statement that an energy audit of a house is needed? He did not mention, of course, that that would last significantly longer than the pack, and that it had a rigour that meant that it was of use to the purchaser, whereas the sellers packs are so lacking in rigour that they will more often lead purchasers astray than be likely to give the kind of information that they would want?

John Hayes: As ever, my right hon. Friend makes an apposite point, with his usual skill and charm. The picture, however, is even worse than he paints it.
	I suspect—and the Minister has yet to convince us otherwise—that people will commission additional surveys to supplement these inadequate reports. I invite hon. Members to imagine that they are buying a property and are presented with a sellers pack containing basic information, and to imagine their suspicion about the paucity of that information—and their desire, in the case of an older property or one featuring particular difficulties, to obtain information that is as detailed as possible. I suspect that they would arrange their own survey. Not only will there be a sellers pack floating about; for the reasons my right hon. Friend has given, additional surveys may well be commissioned. Indeed, I suspect that the sellers packs will prompt additional surveys rather than replacing surveys.

Edward Davey: Many lenders have not said that they will rely on home-commissioned reports. Many will have their own valuations carried out. Moreover, it should be noted that house sales fall through mainly because of valuations done by lenders, as opposed to surveys undertaken by buyers.

John Hayes: The hon. Gentleman is right, and I shall return to his point if I have time.

John Butterfill: Is there not a great danger that some large firms of estate agents that claim they will co-operate will do so because many poorer vendors cannot afford packs up front? The estate agents will say, "We will supply you with a pack, and when we have sold your property, we will knock the cost off the proceeds of sale." The poor vendors will then be locked into the clutches of estate agents who, in some instances, are quite unscrupulous. They will not be able to change from an estate agent who does not perform properly, because they will have a debt to the agent who supplies the pack.

John Hayes: That is a good point. As was mentioned in Committee, in other countries there are strict regulations—indeed, laws—preventing such a possible conflict of interests. In this country, that does not apply, and the Minister has given no guarantee that it is likely to. I think that there may well be real issues of probity. Such issues were raised in the other place, and they were raised by Conservative and Liberal Democrat spokesmen in Committee. Once again, however, we hear nothing from the Minister, despite the length of his speech.
	The Government say that the proposal will speed up the process, and the hon. Member for Stafford (Mr.   Kidney) repeated that claim. But the Lords, including Lord Donaldson, say that it may have the opposite effect—that it is likely to slow down the process.
	Let us imagine another scenario. Someone may want to put his house on the market quickly. He has in mind a potential buyer, perhaps a person he knows in his locality. He will not even be able to begin the transaction until he has commissioned and put into effect a sellers pack. If neither party has demanded that, it is nonsensical to suggest that it is likely to speed up the market and make it more efficient.
	The Government say that sellers packs may cost only £600, but we know that they will not be introduced until 2007. We know that by the time they have become compulsory, things will have moved on. We know that there is no cap on the total price of the packs. The Minister's blithe statement that competition will drive the price down flies in the face of all our experience of buying and selling houses, and of commissioning reports of one sort or another concerning the condition of those houses.
	The Government say that sellers packs will remove the need for other surveys, but as the hon. Member for Kingston and Surbiton (Mr. Davey) said, mortgage lenders have given no assurances of their willingness to accept them as an alternative to their own surveys. Indeed, the Council of Mortgage Lenders has made clear that it is not prepared to give any such guarantee on behalf of its members. The Minister could not name a single lender that had given an equivalent guarantee. He said that they were all geared up to writing them and were starting businesses in order to roll them out, but that is no surprise, is it? No doubt sellers pack millionaires will emerge from this. That will be the Minister's legacy.
	The Government say that sellers packs should be compulsory. In the other place, Lord Hunt described the compulsion issue as the key question. If the packs are such a good idea, why do not the Government trust the people and allow them to say whether they want them or not? If the packs are to replace any other surveys, including those required by the companies offering mortgages, why do the Government not allow them to be voluntary?
	The case made by peers throughout the other place was convincing. They said, much as we did, that the Government had failed to persuade anyone of their argument, and we heard the reason for that at the very end of the Minister's long speech. He said that they were obliged to do it because it was in two manifestos. For once, the Government are sticking to a manifesto commitment. That is an unusual and welcome change from common practice.
	The Government said that they would do this, and despite all the evidence they intend to do it. In effect, they are saying, "We don't know for how long the sellers packs will be valid, we don't know who will accept them and we don't know what they will cost, but we will impose them on you anyway." They are wrong, the Lords are right, and we will support our noble Friends and other Members of the other place who have championed the cause of sellers and buyers in opposing these silly packs.

Edward Davey: In the three minutes that remain, may I try to be helpful to the Government?
	Lord Rooker said in the other place:
	"I realise that ours is a high-risk strategy . . . The fact that 40,000 dwellings are marketed every week means that if we get our provisions wrong, the Government are in deep trouble."—[Official Report, House of Lords, 3 November 2004; Vol. 666, c. 355.]
	I believe that the Government should be a little more cautious. They should think about the risks not just to them but to the millions of home buyers up and down the country. This really is a gamble. The Government have more or less admitted that they will arrange pilot schemes and a voluntary period, but they need to go much further.
	The real danger is that the housing market could grind to a halt in some areas, and purchase costs could rise significantly. That could damage not just the economy but many individuals.
	Lord Hunt of Wirral quoted comments by the late Earl Russell in one of his last speeches in the other place:
	"There is necessarily a place for compulsion, but it is an unpleasant, expensive and labour-intensive process that will not become easier while the Chancellor is engaged in reducing the number of civil servants. So where something can be done voluntarily and compulsion rendered unnecessary, it is a good thing". —[Official Report, House of Lords, 21 July 2004; Vol. 664, c. 270.]
	Earl Russell was right. There is no need for compulsion. There is no demand for it. It will be a costly mistake if the Government push ahead.
	I hope that the Government can, through the discussions in this and the other place, put into the Bill the notion that it will keep the home information packs voluntary until another order comes before Parliament. The Minister made great play of the promises in the manifesto. If he reads it again, he will find that the Labour Government promised only to introduce home information packs. Nowhere in the manifesto does it say that they should be compulsory. With the support of the Opposition, the Government could meet the manifesto pledge by keeping the proposal voluntary. Then they will get the support of all parties and of both Houses.

Question put, That this House disagrees with the Lords in the said amendment:—
	The House divided: Ayes 292, Noes 148.

Question accordingly agreed to.
	Lords amendment disagreed to.

John Butterfill: On a point of order, Mr. Deputy Speaker. It may have come to your attention that the timetabling of the debate on that group of amendments was such that not only did no Back Bencher on either side of the House have the opportunity to speak, but even the Opposition Front-Bench spokesmen were obliged to curtail their speeches on probably the most contentious clause—indeed, possibly the only contentious clause—in the Bill. Perhaps you, Mr. Deputy Speaker, could rule on that, and those in another place may wish to take it into account when the Bill goes back to them.

Mr. Deputy Speaker: The hon. Gentleman knows that I cannot rule on that matter now; those arrangements were agreed by the House earlier. However, he has got his point on the record and no doubt it will be read by those who are interested in such matters.

Clause 145
	 — 
	Home Condition Reports

Lords amendment: No. 140.

Keith Hill: I beg to move, That this House disagrees with the Lords in the said amendment.

Mr. Deputy Speaker: With this we may take the following: Government amendments (a) to (d) in lieu of the Lords amendment.
	Lords amendments Nos. 123 to 127, 129, 131 to 134, 136, 138, 139, 141, 142, 145 to 150 and 260.

Keith Hill: It may be for the benefit of the House if I explain that amendments Nos. 123 to 127, 129, 131 to 134, 136, 138, 139, 141, 146, 150 and 260 are technical amendments that clarify or remove ambiguities or repetition in the Bill, and improve the definition of the word "marketing". Amendments Nos. 142, 145, 147, 148 and 149 would make provision for an estate agents redress scheme. I do not propose to dwell on those amendments at great length, as there seems to be a high level of agreement about the proposals in them—although I shall, of course, be happy to return to them if they are raised by other speakers.
	Amendments (a) to (d) in lieu of Lords amendment No. 140 would ensure that adequate safeguards are placed on the register of home condition reports. If the House will forgive me, I shall say a few words about those, because this is new matter for this Chamber.
	It will be vital for the public to have confidence in the new home condition reports, and a register for home condition reports will help to ensure that. The register will prevent unscrupulous people from tampering with home condition reports once written, because paper copies can be compared with the register. The register will also ensure that the home condition report can be prepared only by a member of the certification scheme. Someone fraudulently passing himself off as a home inspector —or, indeed, a former home inspector who has been expelled from the scheme—will be unable to register a home condition report.
	To guard against the possibility of a seller "shopping around" and obtaining a number of home condition reports from different home inspectors, we propose that the home information pack include copies of all home condition reports obtained on the property within the previous 12 months. The register would ensure that that requirement could be enforced. It would be an important resource to help the certification schemes ensure the competence and probity of home inspectors, and that the inspectors were properly insured. Taken together with the checks and balances already in the Bill, this should enable buyers and sellers to rely with confidence on home condition reports.

Geoffrey Clifton-Brown: Will the right hon. Gentleman give way?

Keith Hill: If the hon. Gentleman will forgive me, I feel that I need to say a few more words in amplification of the proposals for the scheme first, but I will happily give way to him in due course.
	Provision is already made for such a register in clause 145(5)(d). The purpose of the amendments is to ensure that that register is kept in a proper way. Amendments (a) and (b) to Lords amendment No. 140 strengthen the provisions for approved certification schemes for home inspectors producing home condition reports. The scheme is required to make provision for the registration of all home condition reports. That will greatly enhance the ability of consumers and others to use the home condition report and to trust it, for the reasons that I shall explain.
	Certification schemes would be approved by the Secretary of State. They are likely to be run on a not-for-profit basis by private companies owned by stakeholders. We had initially intended the control of access to information on the register to be left to the terms of approval. However, that might not be legally effective, and might not be sufficient to ensure that appropriate and adequate safeguards are placed on the creation and use of the register.
	Amendment (c) inserts after clause 145 a new clause that will ensure that the Secretary of State can make regulations allowing any private keeper of the register to restrict access to it to certain limited and prescribed circumstances and purposes. It requires that the onward use of information obtained from the register should respect privacy considerations, and that as far as possible, any conditions imposed by the seller on the use of information in a home information pack, in accordance with clause 139, be respected. It also makes the unauthorised disclosure of information a criminal offence in order to deal with someone who, for example, sells details to a double glazing salesman, or the selling of information on the home of a public figure to a newspaper. Finally, the amendment allows the Secretary of State to maintain the register if the private operator proves unsatisfactory.

Geoffrey Clifton-Brown: Can the Minister say in what form the register be kept? Will it be kept electronically and who will have access to those records? Will the Government have access to them? There is the suspicion that they could use home condition reports to do the next council tax revaluation for nothing. How will the Data Protection Act 1998 protect people's privacy, given that there will be a lot of very private information in the packs?

Keith Hill: It is precisely because I anticipated that the hon. Gentleman—whom I know well, and with whom I have jousted on many previous occasions—would take an interest in these matters that my speech includes what I hope will prove persuasive answers to those issues.
	Dealing with these important issues administratively when approving a certification scheme involves doing so behind closed doors, but we feel that it is in everyone's interest that they be dealt with openly and on the record through regulations. The amendment should ensure that the register is kept in a proper way, while respecting privacy considerations. An electronic register of home inspectors and of home condition report data is essential to ensure authenticity and trust. I should emphasise that access to the register will not be a free-for-all and will be strictly controlled.
	We envisage that access will be available to the seller and potential buyers, and to their professional advisers and agents, so that they can, for example, check the integrity of copies of home condition reports supplied to them. We also intend to enable access to certification schemes in order to assist with their operation, and to ensure that proper standards are maintained. We envisage that certification schemes will use the register of home condition reports to monitor, or to undertake, spot checks on the work of home inspectors to ensure that they maintain the required standards.
	Allowing mortgage lenders online access to the register of home condition reports will assist with valuation assessments and help to avoid unnecessary valuation inspections. It will enhance the efficient operation of the home buying and selling process, and reduce costs for home buyers. We continue to work with the Council of Mortgage Lenders and other stakeholders to ensure that lenders can use the home condition report as a source of information from which a valuation can be derived, without the need for a separate valuation inspection.

Matthew Green: Much of what the Minister is saying is welcome, but I am concerned about what happens when someone chooses to market their property without going through an estate agent, as they have the right to do. When they produce their pack, how will they check who has access to such information? Will a prospective buyer gain access to the register? If so, will they access such information only in respect of the property in question, or will they be able to peruse information on all properties online, simply because they have said that they are interested in buying a particular property? I am slightly confused as to how the process will work.

Keith Hill: It will be for the seller or their agent to make the home condition report available to the potential purchaser. Provision will be made to ensure that access to the report is restricted to those potential buyers to whom the would-be seller wishes such information to be made available. If the hon. Gentleman will allow me, I shall spell the situation out in a little more detail in due course.
	The expected content of the home condition report has already been discussed in detail with lenders to ensure that it incorporates the data that they will need to create valuations, using automatic valuation models or other innovative valuation methods. We therefore envisage that access to the register will be allowed to lenders and others involved in carrying out valuation assessments on behalf of lenders.
	I should point out that no final decision has been taken as to whether one of the proscribed uses of information from the register will be as a source of statistics on the condition of the nation's housing stock and its energy efficiency. If such a use were permitted, it would be subject to data protection and privacy considerations. Amendment (c) provides for regulations that restrict access to prescribed circumstances or purposes, and to prescribed descriptions of persons. We intend that access will not be indiscriminately available. For example, a potential buyer would need to have the HCR reference number in order to access a home condition report on the register. That reference number would be available only from the seller or their agent, which will ensure that data on the register is not available to any person who cannot satisfy the seller or their agent that he is a bona fide potential buyer.

Geoffrey Clifton-Brown: The Minister has virtually admitted that what I said to him a few minutes ago is true. He says that the Government will use this information for statistical purposes. Is it not true that that will enable them to use it to obtain a revaluation of the entire nation's housing stock at very little cost, and without involving valuers?

Keith Hill: The hon. Gentleman is getting over-excited about a possibility that the Government are not contemplating. We have made no final decisions on this matter, but we do take into account the possibility that the register could be of value in making broad assessments of the condition of the nation's housing stock. The hon. Gentleman takes a close interest in this issue, and he surely will not regard such an approach as disadvantageous, should we decide to pursue it. However, this is a matter for consultation and open discussion in due course.

David Kidney: I hope that my right hon. Friend finds my intervention helpful. Is it the Government's intention to make it a criminal offence for people to disclose information from the register that should not be disclosed, and is that the purport of subsection (7) of amendment (c)? Moreover, is there a typographical error in that subsection? It states:
	"A person who contravenes subsection (3) is guilty of an offence",
	yet subsection (3) deals with the paying of a fee in order to include a report on the register. In fact, it is the contravening of subsection (4) that would constitute a criminal offence.

Keith Hill: Can the House be surprised that I describe my hon. Friend as my guru in these matters? Not only has he anticipated exactly the point that I was about to make on disclosure, but he has also made a typically shrewd point about a typographical error in the amendment. I can confirm that there is indeed such an error, and it will of course be put right. I am most grateful to him for drawing the House's attention to it, and I am sure that he is grateful for my immediate and positive response. That certainly demonstrates the listening character of this Government and this Minister.
	I was about to say that any disclosure, except as provided for in regulations, would be taken very seriously and would amount to a criminal offence. My hon. Friend the Member for Stafford (Mr. Kidney) is absolutely right about that. Anyone committing such an offence, for instance, by passing on data from home condition reports to a building firm or to the proverbial double glazing salesman, would be liable on summary conviction to a fine of up to level 5 on the standard scale—currently a maximum of £5,000. That is equivalent to the penalty for offences relating to infringing the Data Protection Act 1998. The Home Office has confirmed that criminal offences for the unlawful disclosure of information are the norm in legislation and has approved this particular offence.
	Clause 153 provides that the Secretary of State may make grants towards expenditure incurred in connection with the development of proposals for the contents of home information packs or of potential home inspector certification schemes. Amendment (d) is consequential on the introduction of the new clause and provides that the Secretary of State may also make grants towards expenditure incurred in the development of a register of home condition reports.
	There are legitimate sensitivities surrounding disclosure of information—I fully concede that to the hon. Member for Cotswold (Mr. Clifton-Brown)—we will not know for some time which certification scheme will get approval. We will need to begin work on developing the technology for a secure register of home condition reports as soon as possible in order to address those issues, and that work will require a grant. We also need to ensure that the register is not specific to a particular certification scheme so that it is possible for the keeper of the register to be changed, if necessary, without resulting in practical difficulties.
	It is important that consumers and lenders can trust the home condition report and be able to rely on it with confidence. Together with the provisions for home inspectors' certification schemes already in the Bill, these amendments should provide that confidence. In moving these Government amendments, I draw the House's attention to my support for amendments Nos. 142, 145, 147, 148 and 149.

Robert Syms: This is an important part of the Bill; it is just a pity that we are here at five minutes to midnight debating such important detail. I wish to put a number of questions to the Minister.
	The proposal to have a register of approved surveyors or inspectors is sensible because people can check the register to see whether the person is qualified. One of the major concerns in Committee was whether the supply of surveyors or inspectors would be sufficient, so having a register also seems reasonable on those grounds. My question is whether the register will be broken down into regions or counties. There could be a surplus of surveyors in the north-west, with other areas having a deficiency, which could affect the ability to produce home condition reports within a reasonable time frame. It would be helpful to have a breakdown of surveyors and inspectors, including where they live.
	The Minister made several points about the home condition report—for example, whether it should have a reference number or be put on the internet and what the controls should be. My hon. Friends have raised a number of concerns about those issues. If the information is too restricted, there is a danger of missing some opportunities. Will the register of home condition reports be made available to those who are registered inspectors or surveyors? If a home has been sold four times and had four home condition reports, the logical starting point for a surveyor would be to look at the last four reports on the home to see whether there had been any problems in the past. It seems silly to start from a blank sheet of paper when, first, there is a shortage of surveyors and, secondly, the home to be inspected has already been inspected many times.

Geoffrey Clifton-Brown: May I suggest a simple way around that problem? My hon. Friend might want to press the Minister on what I am saying. If the home condition report and home seller's pack become the property of the purchaser on completion of the purchase, the purchaser will then have full property rights and would be well advised if he wanted to sell the house subsequently to make the information available to his surveyor because it would reduce the cost of producing a new home condition report.

Robert Syms: I thank my hon. Friend for making that reasonable suggestion. I am sure that what he says will be heard. When a house is modern and has been sold a number of times, it would be illogical to deny information about it to registered surveyors or inspectors.
	The Minister also referred to lenders having the information. The standards of building on estates in certain parts of the country are not particularly good, so is it not a matter of concern that, if lenders have access to the register, they might blight certain estates? Accusations are already sometimes made about lenders, particularly when certain areas have a bad reputation. How free will access to lenders be? Will they be able to look at individual reports or at the register in its entirety? I suspect that many lenders will build up a picture, which could lead to decisions being taken on the basis of the postcode. That could be a problem for some people. How will the proposals operate in practice? It is important to get the balance right between having reasonable access so that we do not always have to reinvent the wheel and protecting the privacy of the homeowner or home seller. As the Minister said, we do not want the double glazing salesman or building company to have full access to the information.
	If the Minister has enough time, will he say more about whether the insurance scheme for home condition reports is in place? I know that concerns have been raised about that. Insurers are also worried about problems of flooding, underground drainage and so forth. Has a final decision been taken about what type of report will be used for the register? We have only a few more minutes left, so I will end there to allow other hon. Members to ask a few questions.

Matthew Green: I will be brief. We broadly welcome the amendments in the group, including the Government amendments, which go a long way towards dealing with the concerns of the House of Lords, but I want to ask the Minister a couple of questions about the administration and security of the system.
	From what the Minister described, it would appear that, under the system, people producing the reports could post them on to a register via a remote server somewhere. The difficulty arises in controlling access to it. The Minister says that buyers will be given a unique number for a particular property, allowing them to look into that single property alone. Even with a good random generator of numbers, given the sheer number of properties available on the market at any one time, it would be possible for someone to guess the numbers and be able to look at other properties. That will be a problem if the register is accessed through a single number, however large. In reality, there are likely to be patterns in the numbers; they are not purely random. From what the Minister described, it would be possible for people to view other properties.
	The question of security raises another potential concern. As we saw last week, online banks can have problems with unauthorised access to some of their systems. Can the Minister be confident that no one could hack into the system holding the details on, say, the house that the Prime Minister has just purchased and sell the information or publish it on the internet? Can the system be secure at the same time as being flexible enough to allow access to all the users who need it? The Minister seems to have much more confidence in the ability to set up a foolproof system than I have.
	The amendments have gone a long way towards addressing the issues raised in the other place. We do not support home information packs, but if they do go ahead the amendments will be necessary. On that ground, we will not oppose the Government on this issue tonight.

Geoffrey Clifton-Brown: I shall take one minute to make a few key points and to enable the Minister to reply to the important points that have been made.
	First, access to information is critical. One of the key aspects is that, if it is possible for unauthorised people to access the information, the home information packs could become a burglars' charter. I hope that the Minister will reassure us that hackers will not be able to access the information if it is stored electronically. Given the record of such systems, I do not know how he can do that.
	Secondly and most importantly, many inspectors will be needed. Inevitably, some of those inspectors will be trained at very short notice and mistakes will therefore be made. It is important that an adequate insurance scheme is in place. People must also have the ability to sue on the reports if they prove to be incorrect. I hope that the Minister can tell us whether that will be the case, because otherwise the reports will have zero value.

Keith Hill: I shall take the issues raised in reverse order. The hon. Member for Cotswold (Mr. Clifton-Brown) asked about insurance against error in the reports. I may say that an indemnity scheme has always been part and parcel of the proposition. The indemnity scheme will apply to home inspectors as it already does to conveyancers, and we think that it is a good idea to extend it to estate agents, through the estate agents redress scheme, which has been approved by the other place and has received a general welcome for both particular and general reasons. The monitoring of home condition reports will also allow judgments to be made about the performance of individual inspectors.
	The hon. Gentleman raised the hoary old issue of access to information and the burglars' charter. We have gone over that matter on many occasions, but I shall reiterate—given that the allegation always seems to creep into adverse media coverage—that the home condition reports will contain no plans of the property, no information about security devices or alarms and no information about safes. We do not believe that the reports will remotely begin to add up to what he described as a burglars' charter.
	The hon. Member for Ludlow (Matthew Green) raised several points and I am grateful for his qualified support. He asked about the operation of the electronic system and whether someone could hack into its numeration arrangements. That is a valid issue. We need to get the details right, and that is why we would do a great deal of work with all the relevant partners to ensure that that could not happen.
	The hon. Member for Poole (Mr. Syms) raised several issues. He asked whether lenders will be able to look at individual reports, and the answer is yes. They will have the advantage of looking at the entirety of the property, which is not always the case in the present system. He asked whether the register would be open to other inspectors and would they have access to all home condition reports on the register. Again the answer is yes. He also asked whether there will be regional or local registers, and the answer is yes. I hope that I have been able to reassure him on the points that he raised.
	Lords amendment disagreed to.
	Government amendments (a) to (d) in lieu of Lords amendment No. 140 agreed to.
	New Clause

Decent Homes Standard for Social Housing

Lords amendment: No. 190.

Keith Hill: I beg to move, That this House disagrees with the Lords in the said amendment.
	Yes, it is me again. The new clause proposed by the amendment would require the Secretary of State to ensure that, by 2016, all existing social housing stock should, as far as is reasonably practicable, achieve a SAP rating—an energy rating under the standard assessment procedure—of no lower than 65, which would amount to a change in the decent homes standard. I refer to that point because material circulated among Members recognises that the decent homes standard is the Government's vehicle for the delivery of heating and thermal comfort.
	I remind Members that the decent homes standard aims to tackle the worst problems. It triggers action; it is not a standard to which work is done. I also remind Members, as I have on earlier occasions, that when the Govt took office in 1997 no fewer than 2.2 million social homes were non-decent and there was a £19 billion backlog of work. The work we have done, and are continuing to do, tackles a range of problems that affect housing—leaking roofs and mould and damp in kitchens and bathrooms that have not been touched since the homes were built, which in some cases was the 1930s. Our work is having a huge impact on the lives of some of the most vulnerable members of society who have lived, or who currently live, in non-decent homes. I said "have lived" because, since 1997, we have reduced by 1 million the number of homes below the decent homes standard—a fact that we celebrate and rejoice in on the Labour Benches.
	The decent homes programme is helping to rejuvenate some of our most deprived communities and is contributing towards improving public health and the well-being of tenants. By tackling poor housing, we are facing head-on a problem that is rife in the most disadvantaged communities and that affects the most disadvantaged groups. By making homes decent, in many cases alongside wider regeneration work, we are making whole areas more attractive places in which to live.
	I should like to quote some of the tenants whose lives have been changed as a result of the decent homes programme, such as a tenant on a Walsall estate—not in the constituency of my hon. Friend the Member for Walsall, North (David Winnick), who is in the Chamber, but in the constituency of my right hon. Friend the Member for Walsall, South (Mr. George)—who said:
	"For many years the residents of Delves West felt like they were forgotten. We never seemed to get any investment in our homes. Thanks to the Decent Homes programme we are now making a real difference. Residents are getting the decent homes they've waited for, for so long."
	In Redcar, some tenants were "over the moon", and a resident in Kensington and Chelsea, visited by my right hon. Friend the Deputy Prime Minister in May, said:
	"It was absolute murder before and now it's a godsend".
	Amendment No. 190 picks up on one aspect of the decent homes programme—improving the thermal efficiency of homes and, in doing so, contributing to reducing fuel poverty and thereby increasing energy efficiency. We take seriously our responsibilities for alleviating fuel poverty. However, I remind the House that the decent homes programme has four elements: meeting the current statutory minimum standard for housing; achieving a reasonable state of repair; ensuring reasonably modern facilities and services; and providing a reasonable degree of thermal comfort. The programme therefore aims to tackle a wide range of problems and to prioritise the worst homes, of which there remain 1.4 million; including a SAP rating of 65 would add a further 1.7 million households, of which, as I shall demonstrate, only 120,000 would be fuel-poor.
	We cannot seek a policy of perfection in regard to one of the four elements of the decent homes standard—thermal comfort—and disregard our obligations to tenants to make more basic improvements. For those people who live in non-decent homes, works such as mending a leaking roof, replacing rotten windows and tackling unsafe electrics matter more than focusing purely on energy efficiency.
	Before I continue, it would be useful to explain to the House what fuel poverty is and how many people it affects. Fuel poverty occurs where those in a household spend more than 10 per cent. of their income on heating their home to an adequate standard of warmth. That is generally defined as 21° C in the living room and 18° C in the other occupied rooms. Fuel poverty affects 350,000 social sector households in England. Of course, the Lords amendment applies to the social sector. About 120,000 of those households meet the decent homes standard and about 230,000 households are currently non-decent homes.
	We expect that the work done to those 230,000 social homes under the decent homes programme will bring most of those households out of fuel poverty. The work done by authorities is expected to raise the thermal efficiency of those homes well above the minimum that triggers action. The guidance that we have issued recommends that, when loft insulation is fitted, authorities should take the opportunity to improve energy efficiency and install it to a much greater depth than the 50 mm that triggers action and that, when new heating is installed or systems replaced, landlords should install energy efficient boilers where possible. Energy efficient boilers have a SEDBUK—seasonal efficiency of domestic boilers in the UK—A to C rating. We also recommend that landlords take advantage of DEFRA and DTI sponsored programmes that require suppliers of gas and electricity to achieve energy efficiency targets by helping landlords to take up energy efficiency measures.

Matthew Green: rose—

Keith Hill: I see that the hon. Gentleman is bestirring himself; and, of course, I give way to him.

Matthew Green: I thank the Minister for giving way, but does he accept that not all the 230,000 households that he says will be raised to the decent homes standard will necessarily reach the SAP 65 rating? Many of those homes may well have to be revisited in future to get them up to that level. In fact, we are talking about guidelines, so some councils—perhaps those facing financial pressures—will not go the whole hog; they will do just enough to meet the decent homes standard without hitting the higher rating.

Keith Hill: Unusually for the hon. Gentleman, he is labouring under a misapprehension. He is usually very precise. In fact, very few of those 230,000 homes are likely to reach the SAP 65 level. That is exactly why I explained that the requirement for SAP 65 would not only embrace the 1.5 million so-called non-decent homes that we propose to tackle using the decent homes programme up to 2010, but entail a return to a further 1.7 million social sector homes that do not attain the SAP 65 level. The important thing to remember is that fuel poverty relates to the percentage of income that is necessarily expended to achieve a decent level of thermal comfort.
	Many householders who live in homes that do not have a SAP rating of 65 are not in fuel poverty because they do not spend a sufficiently high proportion of their incomes on the issue. It is terribly important for all hon. Members to bear it in mind that fuel poverty is a factor of not the physical fabric of a property, but the relationship between thermal comfort, or the need to compensate for heating loss, and income. The truth is that only a small proportion of those in fuel poverty live in social homes that are below the decent homes standard—about 120,000. Many people who live in fuel poverty might live in homes with a SAP 65 rating, which is why our fundamental argument is that it would be an immense over-reaction to insist on the SAP 65 standard across the board to lift households out of fuel poverty. It would be like using a JCB to smash a nut.

Brian White: Tackling fuel poverty is a key objective for the Government. However, they have several other objectives, such as reducing CO 2 emissions, which SAP 65 would help us to achieve. The Minister is missing the interaction between the objectives.

Keith Hill: I disagree with my hon. Friend, although I do not often do that because we have a good relationship both inside and outside the Chamber. We have dealt with such matters already. I have demonstrated that the Government are clearly committed to, and on route towards, achieving their carbon saving and energy efficiency targets. We mislead ourselves if we confuse energy efficiency and fuel poverty because they are different issues that we must separate in our minds.
	The Government's argument is that the small numbers of households in fuel poverty should be dealt with individually. Interestingly, such households are characteristically not made up of senior citizens. They tend to be made up of people on low incomes living in three-bedroom houses. It is clearly possible to devise strategies to deal with such individuals. Indeed, the fuel poverty action plan has been designed to ensure that fuel poverty will be eliminated in such vulnerable households by the year 2010, and a report is due later this year. For all those reasons, although I take my hon. Friend's point about energy efficiency on board, we need to focus carefully on the precise sources of fuel poverty.

David Taylor: My right hon. Friend is one of the more lucid, rational, thoughtful and, especially, numerate Ministers—he is no doubt set for further promotion. Does he agree that if the only available options to address local authority tenants facing fuel poverty are stock transfer, the private finance initiative and arm's-length management organisations, all of which are more expensive than conventional local authority methods of raising houses to a decent standard, fewer houses will be tackled with the available pot of money than would have been the case if he had delivered option four, as he told the fringe meetings at the party conference that he would?

Keith Hill: I am grateful to my hon. Friend, who teases me. Although I know that there is an undercurrent of great seriousness in his observations, I sometimes feel that the fourth option is to him what King Charles's head was to Mr. Dick in "David Copperfield". I decline to be sucked down that vortex.
	We have issued guidance that is designed to improve energy efficiency. The effectiveness of what is being done to improve heating and insulation under the decent homes programme is demonstrated by what our tenants say about it. A tenant in my hon. Friend's and mine beloved east midlands said:
	"At last I have decent heating and a radiator in every room, meaning my home is not only warm and cosy but actually cheaper to heat than before."
	Another tenant in Chelmsford—I like to demonstrate a regional reach in my examples—described how her heating bills dropped from £35 a week in winter to £8 a week all year round.
	We are working very hard to ensure that the Government meet their target on alleviating fuel poverty and improving energy efficiency, but I recognise that about 120,000 householders who live in homes that are above the decent homes threshold are in fuel poverty. However, it is not necessarily the very poor energy efficiency of the homes that is the main problem. As I have said, most of the households are single non-pensioner households on extremely low incomes living in three-bedroom homes. There are other issues to tackle beyond work to the physical fabric of the home.

Matthew Green: Will the Minister give way?

Keith Hill: If the hon. Gentleman will forgive me, I will make progress because other colleagues want to contribute. I am conscious that I have spoken at some length on this amendment and others. I dare say that he will have his opportunity later.
	Amendment No. 190 wants us to tackle the problem of having around 120,000 households in fuel poverty in the social sector by increasing by 1.7 million the number of homes that would need work in accordance with the decent homes standard. Those homes are currently decent but below SAP 65, and they would more than double the number that we still have to tackle under the programme. The amendment would require the minimum standard that triggers action to be SAP 65. That would cost—I say this in all earnestness—£28.5 billion to solve a problem in 120,000 homes. That is roughly equivalent to 8p on the basic rate of tax. This is more than a sledgehammer to crack a nut. The amendment is a JCB. Indeed, a JCB might be the only solution for many homes if all social housing is to achieve a SAP 65 rating. An estimated 400,000 homes could not be brought up to that level of energy efficiency. For those, demolition and rebuilding would be the only solution at a cost of more than £20   billion, excluding any costs of re-acquiring property.
	For the homes that could achieve SAP 65, some would require additional work over and above basic measures to improve their energy efficiency. For example, we would have to carry out insulation to the solid walls. That would cost £6 billion. Then there are those homes that would not be in the decent homes programme since they already meet the current levels of thermal comfort required. Work in those homes would include replacing boilers that are still functioning, modifying electric immersion heaters and installing double-glazing, which would cost £2.5 billion.
	The grand total comes to an astonishing £28.5 billion. Demolition and rebuilding would cost more than £20 billion. Tackling hard-to-heat homes would cost £6 billion. To cover homes that do not currently come under the decent homes programme would cost £2.5   billion. That extra expenditure would cripple the budgets of local authorities and many housing associations. It would mean that work on wider regeneration work, including security measures and environmental improvements, would go undone. Those things matter to tenants, and how would we explain to them that those priorities would no longer be addressed? The new target would amount to moving the goalposts for social landlords who have been working hard to achieve the decent homes standard. Planned programmes of works would need to be rescheduled, which would disrupt not only landlords but tenants.
	Even if it were possible to achieve SAP 65 for the social sector at a reasonable cost, it would still be unwise to fix that in statute. The standard assessment procedure measures energy efficiency on an index calculated by considering the annual space and water-heating costs for a standard heating regime. It is a constantly evolving mechanism that will change in response to new energy efficiency technology and changes in fuel prices. We have a huge range of social housing stock in this country, and a SAP target of 65 would be expensive, unachievable and inflexible. We prefer action on achievable targets to aspirations that, frankly, have not been properly thought through. We want to deliver on our decent homes programme by 2010, not see it jeopardised and perhaps put back to 2016. Above all, we cannot choose one part of our decent homes programme and promote it above everything else. We have a duty to tenants, and must provide them with the improvements in their living conditions that really matter to them. While energy efficiency may be the primary concern for some people, it is certainly not the primary concern for all social sector tenants. Our efforts in this area should remain focused on delivering the essential work needed to make all homes decent, and in doing so we must always maximise energy efficiency and promote the alleviation of fuel poverty. However, to put those two concerns above all else would be unrealistic.
	In conclusion, a target of SAP 65 for all social sector homes would cost the taxpayer about £28.5 billion. The Government are committed to dealing with fuel poverty and to improving energy efficiency. However, we are not committed to doing that in an impractical and ludicrously expensive manner, as the amendment suggests. It is for those reasons that I invite the House to disagree with the amendment.

John Hayes: The Minister said that the amendment, which was supported in the Lords by Liberal Democrats, Conservatives and Cross Benchers, but not by members of the governing party, was a sledgehammer to crack a nut. He said that it was like using a JCB or a juggernaut to deal with a problem that could be dealt with much more lightly. However, it has managed to attract the support of no less a group of people than the National Pensioners Convention, Shelter, Age Concern, Help the Aged, the National Right to Fuel Campaign, WWF, the Campaign to Protect Rural England, the all-party groups on warm homes and on intelligent energy, the Association for the Conservation of Energy and National Energy Action. Most people who are concerned about the welfare of some of our most vulnerable citizens, as well as most people who are concerned about energy conservation, disagree fundamentally with the Minister's analysis.

Brian Iddon: rose—

John Hayes: If the amendment is a sledgehammer to crack a nut, it is supported by a considerable number of people worth listening to, perhaps including the hon. Gentleman.

Brian Iddon: I was chairman of housing when the Conservatives were in power, and I suffered a 75 per cent. cut in funding for both the private and public sectors. Having listened to the hon. Gentleman, may I ask whether, if they regain power, the Conservatives would commit themselves to a SAP rating of 65?

John Hayes: The hon. Gentleman is a wise and shrewd enough parliamentarian to know that you would not permit me, Mr. Deputy Speaker, to detach myself from the proper consideration of the amendment and meander into a debate about the history, interesting as it may be, of his service in local government, or indeed into a fanciful discussion about what may happen at a distant time in the future—although in fact I do not expect it to be very distant, as I should be replacing the Minister in a few months' time if what we read in the press is true.
	I will be absolutely straight with the hon. Gentleman, who speaks with great passion about these subjects: the Conservatives, if I have anything to do with it, will take the issue of fuel poverty seriously. I believe very strongly in the warm homes agenda, and I will certainly, as Minister, review what he has said and done with a view to making significant progress in the campaign against fuel poverty. That is said genuinely; I am not trying to evade his point. He would not expect a bigger commitment than that, given that I am the Opposition spokesman, not the Minister, but I assure him that I will address the issue of fuel poverty when I become Minister and get the red boxes, the car and all the rest of it in a few months' time, and when the Minister begins to enjoy his long retirement and is relieved of the appropriate pressure that is being brought to bear on him.
	The amendment demands that all social housing should meet the standard assessment procedure rating of 65. That is the measure of energy efficiency in homes that is agreed by the Government and recognised elsewhere. There are two aspects to this debate: one concerns carbon emission targets, and the other fuel poverty. Both were well aired in the other place. Perhaps I may beg your indulgence for a second, Mr. Deputy Speaker, to pay tribute to Baroness Hanham and Lord Hanningfield, who did much good work there, together with noble colleagues from other parties. I single them out for particular praise because they did their very best to improve the worst aspects of the Bill. Lord Hanningfield pointed out that the Government had a manifesto commitment to decrease CO 2 emissions by 20 per cent. by 2010 based on 1990 levels; that from 1990 to 1997 carbon emissions decreased by 13.1 megatonnes of carbon; and that since this Government were elected in 1997 they have remained virtually static, while in three of the past four years they have increased. In August this year, the Environmental Audit Committee reported that the Government's latest forecasts indicate that carbon emissions by 2010 will be 8 megatonnes more than the target—a 25 per cent. shortfall.
	The amendment calls for a 20 per cent. improvement in domestic energy efficiency by 2010, based on 2000 levels. That is equivalent to the saving of 5 megatonnes of carbon emissions from the domestic sector by 2010 that the Government originally stated as their intention and is the target that they assured the public no fewer than 15 times would be set as the energy efficiency aim under the Sustainable Energy Act 2003. A range of Ministers assured both Houses that that would be the case, until April this year when they reduced it to 16 per cent.—a saving of 4.2 megatonnes.
	The original target is supported by the Energy Saving Trust, the Government's official adviser on energy efficiency; the Cabinet Office performance and innovation unit, the Government's advisers on energy policy; and the Sustainable Development Commission, the Government's advisers on sustainable development. It is also supported by a large number of Members on both sides of the House, particularly on the Labour Benches, who have taken fuel poverty, carbon emissions, the relationship between the two and the need for better energy conservation very seriously, campaigned on it, spoken on it and made their position patently clear, whereas the Government's position on this is not at all clear. There are fundamental contradictions between what they have said in the past and what they are saying now; but even more than that, there are—heaven forbid—contradictions between what different Ministers say about it.
	The Minister for the Environment and Agri-environment said that
	"research has shown that bringing homes to a SAP rating of 65 is a level at which there is a minimal risk of a household being in fuel poverty."—[Official Report, 19 April 2004; Vol. 420, c. 138W.]
	Lord Whitty expressed sympathy with the amendment. On 19 October, at a meeting of the all-party warm homes group in Committee Room 17 in the House of Commons, the same point was made to him. He replied:
	"I have sympathy with this . . . I am not defending ODPM."
	It is clear that the ODPM and the Minister stand alone in the matter. Even his ministerial colleagues are not prepared to line up alongside him and defend the change of policy. Apart from concerns about emissions and the Government's failure to meet their targets, there are even more profound anxieties about the impact on many vulnerable people.
	The Government have a legal duty to end fuel poverty under the Warm Homes and Energy Conservation Act 2000. The Minister has spoken about the meaning of fuel poverty and made it clear that he shares the commitment to combat it. However, the Government have agreed that a SAP rating of 65 is needed to achieve that objective. Other Ministers have made it clear that the only way in which the Government will achieve their aim is by adopting a different policy—that which is outlined in the amendment. The Government's figures demonstrate that. In 2001, the Department of Transport, Local Government and the Regions consultation on the decent homes standard stated:
	"Twenty-five per cent. of social sector tenants living in homes with these stock measures"—
	insulation and heating measures that comply with the current decent homes standards—
	"are still fuel poor."
	Twenty-five per cent. is approximately 650,000 or 1.4 million people, based on the national average of 2.2 people per household.
	The latest figures suggest that more than 1.141 million homes fall below standards on the ground of thermal insulation. The current policy is to bring those homes up to a decent homes standard, which will not necessarily mean that they escape fuel poverty. It is not good enough for the Minister to say that the Government are committed to decent homes. Of course it is right to improve the stock of social housing in all sorts of ways but it is unacceptable not to tackle the fundamental issue of insulation and fuel poverty as part of that, in order to deliver the Government's stated aims.
	The House of Lords debated the matter in a measured and reasoned way. The debate showed the passions of Members from across the political spectrum. It was not simply a matter of knockabout, Opposition versus Government, politics. Any reading of the debate reveals a genuine commitment on behalf of hard-pressed people.
	The gist of the Government's case is straightforward. They have effectively reneged on their original commitment. They have lowered the bar because they know that it will be difficult to reach the standard that the amendment demands of them. The excuse that the Minister gave initially in his contribution was that doing so would mean taking their eye off the ball for other aspects of the decent homes standard. However, he gave the game away at the end of his speech by saying that it was all about cost. He thus confirmed what was said inthe Lords. In answering the proponents of the amendment, Lord Bassam said that it would focus on one aspect of decent homes to the detriment of others. He said:
	"That is what the amendment would do, but at a potentially huge cost . . . bringing all social housing up to a standard of SAP 65 could add £3 billion to £5 billion to the cost of the decent homes programme."—[Official Report, House of Lords, 3 November 2004; Vol. 666, c. 379.]
	It is not as simple as that, however, because failing to support this amendment will waste vast sums of public money. The Government will ensure that works are undertaken on all social homes to bring them up to the decent homes standard, but they will still leave a large number of people in fuel poverty. The law will require them to address that issue at some stage in the future and to spend additional sums to take those people out of fuel poverty. The truth of the matter is that this is a false economy. If the Government were to get this right now, they could fulfil their legal responsibilities in one coherent and consistent programme. Instead, however, what Lord Hanningfield has described as the "double visit" to the project will cost more and be extremely wasteful. The Government's argument about money does not stack up, given that they have acknowledged their overriding legal duty in this regard.
	More than that, I disagree fundamentally with the Minister on this. This is a very important issue indeed, and not to address fuel poverty would be a dreadful shame that the Minister and the Government would have to carry.

Sally Keeble: Will the hon. Gentleman give way?

John Hayes: I apologise to the hon. Lady, but I am about to finish. I am usually very generous with interventions, as she well knows, but I want to give other hon. Members time to speak. Perhaps she will be one of them.
	The freedom from fear and the freedom from want are fundamental objectives of any decent Government, and this Government should live up to those principles—[Interruption.] Well, the hon. Member for Eltham (Clive Efford) may chafe, but there are people on this side of the Chamber—and, I am sure, on his side—who believe that the mitigation of disadvantage is the greatest purpose of politics. I believe that to be the case, and I make no bones about stating it. I have always believed it, and I have said so many times. This is not a recent conversion for me.

Clive Efford: rose—

John Hayes: I am not going to give way, so I am not sure why the hon. Gentleman is standing.
	We have been told that the Minister is a literate, numerate and rational man. I think that he is also a good man, and that he will want to be remembered as a good Minister. On that basis, and in the spirit of agreement that he called for at the beginning of tonight's proceedings, I ask him to support the amendment and to adopt this standard, thus gaining the support of the broad consensus of opinion. His doing so would cast the Government in an entirely different light.

Matthew Green: I shall be brief, because I know that at least one other hon. Member would like to speak.
	I have a little bit of sympathy for the Minister's position on this amendment; I am perhaps not as dogmatic as others on the issue. However, in attempting to fight it, he has done himself no credit whatever. Uncharacteristically, he has read things into the amendment that are not there, and cited figures that I do not think he could defend on closer examination. For instance, he talked about demolishing large numbers of homes in order to meet the standard, when the amendment says only that it should be met
	"as far as is reasonably practicable".
	I do not think that anyone would find it reasonably practicable to demolish lots of houses and build new ones. That takes £20 billion out of the £28 billion that he cited. I will not start delving into the rest—perhaps other hon. Members will want to tackle the question of the remaining £8 billion—but the figure certainly drops dramatically with a more accurate reading of the amendment.
	The Minister is on difficult ground with this issue. As he himself explained, the definition of fuel poverty involves the amount a household spends on fuel in relation to its income. However, fuel prices are rising, and they are likely to continue to do so. Many people in the House, myself included, do not think that that is   necessarily a bad thing, from an environmental viewpoint. However, by definition, it causes a problem, because if things stand still more people will be put into the fuel-poor categories. The figures that the Minister accounted for—the 120,000, the 240,000 and the 1.1 million people—could all increase.
	There is a great danger that the advantage that the Government have had for the past few years, largely as a result of low fuel prices rather than Government intervention, will disappear. The Minister will be Minister for Housing and Planning when more people enter fuel poverty. Rather than taking an aggressive attitude against the amendment, which is well-meaning and has good practical thoughts behind it, and setting himself dogmatically against it, he should perhaps have moved some way towards meeting it, as it is clear that increasing the SAP rating of properties where it is relatively practical to do so does, as the Minister for the Environment and Agri-environment has made clear, bring people out of fuel poverty.
	I am saddened that the ministerial response has been so dogmatically against the amendment. I shall go against the Government tonight, because I want them to make some move to suggest that they are aware of the gap between where they are and where they will be—it will be a problem—in a couple of years with the continuing rise of fuel prices. I hope that we hear from the Minister that he at least acknowledges that there is such a problem and that he has some action plan to deal with it.

Alan Simpson: I have no doubt that both Opposition parties will vote in support of the Lords amendment and I have no reason to doubt the sincerity of the comments made by both Front-Bench spokesmen, but I must point out in terms of questioning the depth of this commitment that not a single Opposition Back-Bencher has been present throughout the debate on this clause. That is not the case in respect of Labour Members, and I want to address Labour's commitments in my remarks.
	The Minister rightly said that a number of different objectives are built into the decent homes standard. I do not think anyone in the House would dispute the value of that, but it is not true to say that the Government can then use that as a pretext for getting out of what we have set for ourselves as the non-negotiable obligation to eradicate, in its entirety, fuel poverty by 2016.
	The Minister will know from a number of delegations that I have been involved with, particularly from the parliamentary warm homes group—I brought them to see him to discuss this matter—that we have also tried to explore other choices that the Government have. By and large, we have taken a twin-pronged approach to the eradication of fuel poverty: one through the warm front programme and the other through income support measures, involving the Chancellor and the Treasury. However, it is absolutely right to say, as the hon. Member for Ludlow (Matthew Green) did, that the viability of that intervention in income support will be put seriously to the test.
	We have seen the end of the era of low energy prices; we are knee-deep in an era of dramatically increasing energy prices. None of us should kid ourselves that it will come cheap to the Government to intervene to pay people to throw money out of poorly insulated properties for no gain at all. There will certainly be a negative consequence of massively undermining our commitments to carbon reduction targets. The best way to tackle this is to address the structural condition of Britain's housing. As other Members have mentioned, on 19 April this year my hon. Friend the Minister for the Environment and Agri-environment pointed out that the best way to do that would be to set a minimum SAP rating of 65 for all social housing.
	I suspect that if we were to do that, some other points that have been made to the Minister would come in on the shirt tails of it. He could, for example, also meet the fuel poverty reduction targets by making those standards apply to the private rented sector. We have tried to make the same representations. But we see in subsequent clauses that we will not go down that path either. We could, as my hon. Friend the Member for North-West Leicestershire (David Taylor) pointed out, give a fresh remit to local authorities for a new era of council house building, which is by far the cheapest and most effective way of intervening in the social sector. As yet, however, none of the promises of a level playing field in respect of local authority housing are in the framework for delivery by either the Minister for Housing and Planning or other Ministers.
	What should we do to meet our existing legal obligations to eradicate fuel poverty? The Government's Fuel Poverty Advisory Group is now saying, in consistent terms, that we are not on track to meet our legal targets. We have choices about how we can meet those targets, but one choice that we do not have is to do nothing. Unfortunately, one of the ways in which we have built up cost consequences is by structuring the warm front programme so badly in the first instance that we are duplicating costs. We began by quoting numbers of households in fuel poverty that we have helped—we never said that we were not helping them out of fuel poverty, but we said that we were helping them in it.
	The reality of the fuel poverty benchmark will not go away. The amendment gives the House the chance to address a structural issue with a structural solution. I beg the Minister to take that on board, not as a threat or challenge from the other place, but as a way of helping us out of a hole into which we have been digging ourselves.

Sally Keeble: I had not intended to contribute to the debate today, and only the challenge from the hon. Member for South Holland and The Deepings (Mr. Hayes) made me feel that it was worth saying something in support of the Government's position and opposing that of the other place.
	It seems to me that the Conservative party has completely misrepresented some of the basis of tackling fuel poverty and of the intent of the decent homes strategy, for two reasons in particular. First, we needed a decent homes strategy because of the legacy of disrepair that we inherited when the Conservative party left government. I was a council leader in one of the areas with some of the worst social housing in the country, and I recall how those homes were starved of funds, the price paid in terms of the discomfort of people living there and the real hardship of thousands of families in social housing that was on the skids. We needed a decent homes strategy so that social housing could approach a reasonable level after all that disrepair.
	Like so many things that the Government have done, that strategy might not seem the most wonderfully heroic new socialist dawn. Given what we took over, however, it was a supremely ambitious programme, and extremely difficult to deliver. Once it is achieved, which I am sure it will be, the Government will have every right to be extremely proud of it. The only way to achieve our decent homes target is to balance the key measures that make homes unpleasant and unfit for people to live in. That is a question not just of technical standards but of what happens to the people who live in those properties and what they need.
	Secondly, when we came into power we were confronted by massive fuel poverty, particularly among the old. A key factor in fuel poverty, which the Minister addressed and the hon. Member for South Holland and The Deepings did not, was income. That is why we introduced the winter fuel allowance, which the Conservative party opposed bitterly. It ill behoves a party that so opposed the winter fuel allowance to preach to anyone about fuel poverty. The reason why it is residual groups such as single people on low incomes, households with families or people with disabilities who are in fuel poverty is that we dealt with fuel poverty among pensioners with the winter fuel allowance, which has been increased year on year.   
	If we are talking seriously about tackling fuel poverty, I can certainly describe my wish list—as the Minister well knows, for I have berated him about housing improvements on several occasions. We should think not just about social housing but about private housing. Social housing sometimes has to be knocked down and replaced, but we must also deal with fuel poverty in the private sector—[Interruption.]—I see that I am now being asked to finish my speech.
	There is a huge agenda to be tackled. I agree that we should keep to the programme that we have set and observe the priorities involved in it, but we should not lose sight of bigger goals. I do not think that the amendment would help us to achieve those goals, on which I am sure we all agree.

Brian Iddon: I want to make three brief points.
	I am concerned about fuel poverty. My right hon. Friend the Minister said that 120,000 people were in that position, but I believe that a 10 per cent. fuel price increase would return 500,000 people to fuel poverty. We are on a treadmill, and I remind my right hon. Friend that fuel companies are making obscene profits: I think they amount to £8 billion. I hope that he will discuss with his friends on the Treasury team the possibility of a windfall tax so that we can really help those who are being subjected to fuel poverty by price increases. I have signed an early-day motion on the subject.
	I raised the second point in Committee. We are setting different decent home standards for the public and private sectors. I am grateful for what the Government are doing in the private sector. Improved building control procedures are beginning to deliver better decent home standards, along with better architectural design and other features, but we are not catching up with that in the public sector.
	The third point is this: we have wasted an awful lot of money trying to bring homes up to a decent standard in terms of fuel efficiency. We began with draught stripping, then dealt with cavity walls and UPVC double glazing. We improved central-heating systems in a thousand and one different ways. My plea to any Government, including this one, is that they take a holistic approach rather than persistently going back—three or four times, in fact—to trying to bring houses up to decent home standards.

Keith Hill: I shall try in the short time available to me to respond to all the points that have been raised.
	The hon. Member for South Holland and The Deepings (Mr. Hayes) expressed his personal passion for the warmer homes programme, but as my hon. Friend the Member for Nottingham, South (Alan Simpson), observed, that passion was clearly not shared by his Tory colleagues, for the Tory Benches were empty throughout his speech. In fact, his colleagues missed the wrong speech on the wrong subject. However, since despite his weasel words and disavowals he spoke in favour of the amendment and is likely to divide the House, I think we can assume that he has committed the official Opposition to expenditure of at least £28.5 billion to achieve SAP 65 rating. No doubt the shadow Chancellor of the Exchequer, the right hon. Member for West Dorset (Mr. Letwin), will be most interested to learn of that not insubstantial spending commitment. The hon. Gentleman may find himself out of a job rather sooner than he has a chance to succeed me in mine.
	I was grateful for the "little sympathy" expressed by the hon. Member for Ludlow (Matthew Green). He drew attention to the qualification
	"as far as is reasonably practicable"
	in the amendment, and argued that it would mean lower costs than I had identified. But where does that observation get us? It is as long as a piece of string. The amendment either indicates a serious attempt to attain a SAP rating of 65 or it does not. I have described the financial implications of taking it seriously, which are immensely costly. I have argued that it is a misplaced policy because, in the social sector—the amendment refers to the social sector—fuel poverty is a limited phenomenon that can be tackled by individual households.
	That brings me on to the observations of my hon. Friend the Member for Nottingham, South. He is right. We have spoken about the matter on many occasions. I respect his commitment and his long-term campaign on these issues.
	The hon. Member for South Holland and The Deepings drew attention to observations by ministerial colleagues in the Department for Environment, Food and Rural Affairs. However, DEFRA has not said that a SAP rating of 65 is necessary in all stock. What it has said is that removing fuel poverty depends on the characteristics of the individual household, but that SAP 65 is the level at which there is a minimal risk of a household being in fuel poverty. The precise answer given by the Minister for the Environment and Agri-environment to the hon. Member for Guildford (Sue Doughty) was that removing fuel poverty depends on the characteristics of the individual household. I recognise that we may be in an era of rising energy prices, but we cannot base an expenditure commitment of that scale on a relatively unquantifiable guess.
	My hon. Friend the Member for Nottingham, South rightly talked about the warm front programme, but I remind him that that programme deals exclusively with   the private sector and that that is where the problem of fuel poverty is immensely more extensive. My hon. Friend the Member for Northampton, North (Ms Keeble) was right when she identified that the kernel of the fuel poverty issue is in the private sector, but the amendment is about the social sector, not the private sector. My contention is that, because the standard is much higher in the social sector, the issue is much more manageable through interventions other than this blunderbus approach to SAP 65. I was grateful to my hon. Friend, a distinguished former housing Minister, for her support and for exposing the hypocrisy of the Conservative party.
	I say to my hon. Friend the Member for Bolton, South-East (Dr. Iddon) that I will certainly draw to the attention of colleagues in the Treasury his observations about fuel prices and a windfall tax. I thought that he was wrong when he said that we were not catching up with the private sector. For all the reasons that I have mentioned, I believe that we are doing and will do better in the social sector. However, as he demonstrated to me when I visited him in the Haulgh in Bolton, it is best to do it together. I accept his observations about a holistic approach.
	I know that, in some respects, my response will be a disappointment to colleagues on the Labour Benches, but I have attempted to be precise and accurate and to demonstrate the Government's commitment to dealing with fuel poverty. It will be dealt with in the social sector by techniques that are different from those proposed in the amendment. For all those solid reasons, I invite the House to disagree with the Lords in the said amendment.

Question put, That this House disagrees with the Lords in the said amendment:—
	The House divided: Ayes 265, Noes 156.

Question accordingly agreed to.
	Lords amendment disagreed to.

Clause 3
	 — 
	Local housing authorities to review housing conditions in their districts

Lords amendment: No. 1.

Keith Hill: I beg to move, That this House agrees with Lords in the said amendment.

Mr. Speaker: With this we may discuss Lords amendments Nos. 2 to 25, 212 to 214, 216, 218, 219, 221, 248, 250 to 252, 271, 273, 275 to 278 and 281 to 283.

Keith Hill: The great majority of these amendments are, as you can see, Mr. Speaker, minor and technical. They are either consequential on amendments made to later provisions in the Bill, intended to rectify small errors or clarificatory, but there are a few that I should briefly like to draw to the House's attention.
	Lords amendment No. 2 responds to concerns raised by the Joint Committee on Human Rights. Under clause 5, which deals with the health and safety rating system, where a category 1 hazard exists, the local housing authority is under a duty to take the most appropriate course of enforcement action available to it. Under clause 7, where a category 2 hazard exists, it may take one of the available courses of action.

Sally Keeble: I am pleased that overcrowding will be dealt with separately, and I congratulate the Government on the consultation on that. What is the Government's thinking on overcrowding in relation to the special needs of children with behavioural and other difficulties, and will those special needs be taken into account in considering the revision of the overcrowding rules?

Keith Hill: As ever, I am grateful to my hon. Friend, who is a former housing Minister. I share her pleasure that we have been able to introduce some important provisions to the Bill on the issue of overcrowding, which she has worked to achieve for a long time. Of course, as we seek to implement those provisions, we will take into account the issues of special needs that she has raised with me tonight and on previous occasions.
	In its eighth and 10th reports, the Joint Committee on Human Rights expressed concerns that the absence of a duty on local authorities to give reasons for deciding which form of enforcement action to pursue under clauses 5 or 7 failed to comply with article 6 of the human rights convention on the right to a fair hearing; could lead to breaches of article 8 on respect for private and family life; and could lead to breaches of article 1 of the first protocol on the protection of property. The amendment responds to those concerns by placing a duty on local authorities to prepare a statement of reasons for their decision to take the course of action on which they have settled. We believe that this new clause responds positively to the Joint Committee's concerns without placing local authorities under a significant additional burden.
	Lords amendments Nos. 212 to 214, 216, 218, 219 and 221 amend clauses 199, 203 and 204. In part, they respond to concerns of the Joint Committee on Human Rights and in part they are clarificatory. Clause 199 allows a local housing authority to require the production of documentation that the authority might need to carry out its functions under parts 1 to 4 of the Bill and to investigate offences committed in relation to any residential premises. In its 10th report, the Committee expressed concern that the lack of procedural safeguards, and the lack of requirement for authorisation, could lead to a risk of unjustified or disproportionate use of the powers in clause 199. Lords amendments Nos. 212 and 213 require that a person exercising the power to require the production of documents has been authorised in writing.
	Clause 203 gives a local housing authority power of entry to properties in pursuance of its duties under parts 1 to 4 and part 7 of the Bill when certain conditions are met. Representatives of the authority must have written authorisation that sets out the purpose for which the entry is authorised and must give at least 24 hours notice to the owner or occupier of the premises they intend to enter. Permission under this clause does not include a power to use force to obtain entry. This power of entry includes entry for the purpose of taking samples. In its 10th report, the Committee expressed the view that the authorisation to express the power should be given at an appropriate level of seniority.
	Clause 204 enables a justice of the peace to issue a warrant for admission to premises. This includes power to enter by force if necessary. This power is applicable, however, only when either entry under clause 203 has been refused, or the property is empty and immediate access is necessary, or prior warning of entry is likely to negate the purpose of access. Lords amendments Nos. 214, 216, 218 and 219 extend the power of entry in clauses 203 and 204 to include an express power for the purposes of inspections under clause 4. These amendments are clarificatory.
	The concern of the Joint Committee that authorisations should be given at an appropriate level of seniority is addressed by Lords amendment No. 221, which introduces a new clause after clause 206. The new clause provides that authorisations under a number of powers in the Bill, including clauses 199 and 203, must be given by a relevant deputy chief officer of the local housing authority or by the officer to whom he reports or is directly accountable.

Sally Keeble: Can my right hon. Friend let me know what kind of documents he was referring to when he referred to the production of documents?

Keith Hill: I am again grateful to my hon. Friend for that question. Of course, I will send her examples of such documentation. I hope that that reassures her of my positive, honourable and transparent intentions and I ask the House to support the amendment.
	Lords amendment agreed to.
	Lords amendments Nos. 2 to 54 agreed to [some with Special Entry].
	Lords amendment No. 55 and Government amendment (a) thereto agreed to.
	Lords amendments Nos. 56 to 100 agreed to [some with Special Entry].
	Lords amendment No. 101 [Special Entry] and Government amendment (a) thereto agreed to.
	Lords amendment No. 102 and Government amendment (a) thereto agreed to.
	Lords amendments Nos. 103 [Special Entry] and 104 agreed to.
	Lords amendment No. 105 [Special Entry] and Government amendment (a) thereto agreed to.
	Lords amendments Nos. 106 to 127 and 129 agreed to [some with Special Entry].
	Lords amendment No. 130 disagreed to.
	It being Ten o'clock, Mr. Speaker, put forthwith the Questions necessary for the disposal of business at that hour, pursuant to Orders [28 June 2001, 6 November 2003 and this day].
	Lords amendments Nos. 135, 137, 143 and 144 disagreed to.
	Remaining Lords amendments agreed to [some with Special Entry].
	Committee appointed to draw up Reasons to be assigned to the Lords for disagreeing to certain of their amendments to the Bill: Paul Clark, Matthew Green, Mr. John Hayes, Keith Hill and Mr. Terry Rooney; Three to be the quorum of the Committee.—[Paul Clark.]
	To withdraw immediately.
	Reasons for disagreeing to certain Lords amendments reported, and agreed to; to be communicated to the Lords.

DELEGATED LEGISLATION

Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

Sea Fisheries

That the Fishing Boats (Satellite-Tracking Devices) (England) Scheme 2004 (S.I., 2004, No. 2467), dated 14th September 2004, a copy of which was laid before this House on 21st September, be approved.—[Margaret Moran.]
	Question agreed to.
	Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

Constitutional Law

That the draft Scotland Act 1998 (Functions Exercisable in or as Regards Scotland) Order 2004, which was laid before this House on 9th September, be approved.
	That the draft Scotland Act 1998 (Modifications of Schedule 5) Order 2004, which was laid before this House on 9th September, be approved.
	That the draft Freedom of Information (Scotland) Act 2002 (Consequential Modifications) Order 2004, which was laid before this House on 12th October, be approved.
	That the draft National Assembly for Wales (Transfer of Functions) Order 2004, which was laid before this House on 11th October, be approved.—[Margaret Moran.]
	Question agreed to.

SITTINGS OF THE HOUSE

Ordered,
	That—
	(1) at the sittings on Monday 15th, Tuesday 16th, Wednesday 17th and Thursday 18th November, the Speaker shall not adjourn the House until any Message from the Lords has been received and any Committee to draw up Reasons which has been appointed at that sitting has reported; and
	(2) at the sitting on Thursday 18th November, the Speaker shall not adjourn the House until a Message has been received from the Lords Commissioners.—[Margaret Moran.]

INTERNATIONAL DEVELOPMENT

Ordered,
	That Mr Andrew Robathan be discharged from the International Development Committee and Mr John Bercow be added.—[Mr. John McWilliam, on behalf of the Committee of Selection.]

PROCEDURE

Ordered,
	That Mr Peter Atkinson be discharged from the Procedure Committee and Mr John Bercow be added.—[Mr. John McWilliam, on behalf of the Committee of Selection.]

HOMELESSNESS (LONDON)

Motion made, and Question proposed, That this House do now adjourn.—[Margaret Moran.]

Simon Hughes: I appreciate the opportunity to raise the issue of homeless people in London. I am grateful that the Under-Secretary of State, Office of the Deputy Prime Minister, the hon. Member for Corby (Phil Hope), is in the Chamber, and I wish the Under-Secretary of State, Office of the Deputy Prime Minister, the hon. Member for Pontefract and Castleford (Yvette Cooper), who would normally have been holding the fort, best wishes during her maternity leave.
	I do not intend to raise the matter in a confrontational way because it is hugely important not only to my constituency but to all London boroughs and constituencies. I hope that I can make constructive suggestions that might inform Government policy. I am conscious of the fact that the Select Committee on the Office of the Deputy Prime Minister is conducting a review on homelessness, and I hope that my speech will be regarded as a contribution to that debate. I would be grateful for a later opportunity to pursue matters that I raise with Ministers bilaterally. I shall state what I believe to be the gravity of the situation before putting on record some telling and worrying statistics—they are not mine, but generally agreed statistics from Government sources—and making my proposals.
	Like most hon. Members, each year I review the balance of the work that comes my way as a constituency MP. I have just done that again as we approach the end of the Session. The largest single issue that arises, as it probably has been for each of my 21   years in this place, is housing and homelessness. People come to me because they have inadequate housing or cannot get decent housing. That problem consistently occurs in inner London and urban areas. My honest view is that homelessness is a ticking time bomb for more and more of London and for more Londoners. The statistics are serious. Homelessness is the most serious crisis facing many Londoners and London families. The Government and councils of all persuasions—I am not making a party-political point—are losing the battle against homelessness rather than winning it, despite the strenuous efforts made by previous Administrations, especially this one and the previous one.
	If we do not house people properly, their health becomes worse, their ability to learn or work is reduced and their personal and social problems escalate—we all pay the price of that. In a capital city of increasing wealth, as London is, and in a country of increasing wealth, one in 100 households do not have a permanent home. Such a record has not existed for a considerable time. Although many people are doing well, more and more are being left behind. Irrespective of what may have been tried and tested, my fear is that unless there is a more urgent response, the Government will stoke up a set of huge social problems.
	There have been many debates on housing and homelessness—indeed, we spent the past few hours discussing those very issues—but this is the first specific debate on homeless people in London since the first year of this Parliament, and I am glad to return to it.
	I want to give some figures, which I understand are fully agreed. The number of households accepted as homeless by the 33 local authorities in London increased from 24,570 in the first year of the Labour Government in 1997–98 to 31,530 in 2002–03, the last year for which figures are available. There was an increase of 10 per cent. in that last year. In the same period in my borough, the figure went up from 893 to 1,671. Those are the people for whom the councils accept they have a duty to provide housing. The figures mean that 1 per cent. of households in London are not permanently housed.
	One of the most worrying trends is the number of young people, and the increase in the number of young people, who have been accepted as homeless. For that purpose, young people are 16 and 17-year-olds, who are all regarded as in priority need, and 18 to 20-year-olds who have been care. In 1997–98, the number of homeless young people was 305, 66 of whom were in my borough. In the past full year, the figure was 2,038, 106 of whom were in my borough—a phenomenal increase of more than 500 per cent. in young people who were accepted as vulnerable.
	There has been a relentless increase in young homeless people in almost every borough. In Lambeth, the figure was 36 in 2000 and 194 in 2003; in Tower Hamlets, it was six in 1999 and 99 in 2003; and in Camden it was nine in 2000 and 118 in 2003. As I said, the number also increased in my borough. The problem is not sectoral but Londonwide.

Paul Flynn: Does the hon. Gentleman agree that the reason for the increase in the figures is not an increase in the number of people who suffer housing distress? The Government have a marvellous record, having reduced the number of rough sleepers to a third of what it was when we took office. The figures look so alarming because the definition of homelessness has been stretched. Had that definition applied when I was a young man, half the population would have been defined as homeless. The figures look so alarming because the definition of homelessness now includes people who are under-housed. The problem is not an increase in the number of homeless people, but a widening of the definition.

Simon Hughes: I do not accept that. There have been redefinitions since 1997, but they were not significant. There is plenty of evidence to support my case, including my constituency experience. Shelter's evidence to the Select Committee inquiry sets out the factors that cause homelessness. Some 17 per cent. of parents and 12 per cent. of friends are no longer able to offer accommodation, and 18 per cent. of homelessness cases—the biggest group—are due to violent relationship breakdown. I hope that the hon. Gentleman accepts that those people are justifiably looking for new housing. Some 7 per cent. of cases are due to non-violent relationship breakdown; 7 per cent. to mortgage arrears; 2 per cent. to rent arrears; 12 per cent. have come to the end of their tenancies; 17 per cent. are caused by other reasons; and 9 per cent. are caused by the loss of other rented or tied accommodation.
	My constituency experience, and that of most of our colleagues, is that more people are becoming homeless. Why? It is because we are not building anything like enough property. If Members talk to the Mayor of London, the Greater London authority or any borough they will see that we are building less than half the property that we need. The most recent figures for London show that 5,209 additional homes were completed with Housing Corporation funding. In the same year, however, 7,823 homes were lost to the rented sector as a result of the right to buy. We are therefore losing homes rather than gaining them.

Paul Flynn: They are not lost.

Simon Hughes: They are lost to the rented sector as a result of the right to buy. If the hon. Gentleman looks at all the trends across London, he will see that the position is the same in my borough, where 185 homes were completed with Housing Corporation funding, but 974 were lost to the rented sector. The number of people who are deemed intentionally homeless has gone up, because the definition is interpreted more tightly, not in a more relaxed way. People coming to my surgeries are priority cases under any definition—they are vulnerable, they cannot work, they are mentally ill or emotionally distressed, and they may be suicidal—but they have been turned down, so we have to appeal. It is not always easy, however, to have them accepted as homeless. The reality is that those people are initially taken out of the figures.
	We are short of new housing and other accommodation in London, partly because people no longer live in extended households of grandparents, parents and children, and they need their own home. When relationships break down, for example, they want their own place. Work by the Mayor and studies of London show that that we have been building about 15,000 new homes a year, but we need at least 30,000, and have done so ever since the Government took office.
	I began by saying that I initiated this debate more in sorrow than in anger, but it is not the case that the position is getting better, as the problem is becoming significantly worse. I accept that there are fewer rough sleepers, but if the hon. Member for Newport, West (Paul Flynn) and other Members talk to people who know about homelessness in London they will discover that some rough sleepers are now staying with friends and family. They are sleeping on the floor and living in other people's accommodation, and are known as the hidden homeless. If the hon. Gentleman looks at the figures or the evidence given to the Office of the Deputy Prime Minister, he will see that the numbers have gone up. I shall give a final set of figures. The number of households in temporary accommodation—people housed in bed-and- breakfast hostels and hotels—has gone up in London from 24,060 in 1997–98 to 59,170 in 2002–03. In London, the average time spent in temporary accommodation before someone who is accepted as homeless is given a permanent home has gone up from 91 days in 1997 to 391 days in 2003. A couple with a child, a couple who have been accepted as vulnerable or a family are now likely to spend more than a year in temporary accommodation, whereas six or seven years ago they would have spent a few months there. People from the street and others are among the figures, so there is a true crisis. If the hon. Gentleman does not accept that, I invite him to look at the cases that I deal with in my surgery. He can sit with me, and see the people who come through the door—they are from all walks of life and backgrounds, and are of all classes, creeds, colours and ages. The problem, however, is getting substantially worse.
	I wish to make a final point about statistics before putting my proposals to the Minister. From a previous debate in which Ministers were generous to my colleagues I know that we still have a huge number of empty properties. The most recent figures show that there were 89,000 empty homes across the capital, and we must be more vigorous in getting those empty homes back into use. We could all come up with our own answers, but I want to put five proposals to the Minister.
	First, we need a new and more urgent drive to identify and fill empty properties. That is always a difficult challenge, but we must do much better. It is a scandal that such properties should be empty, and we could appropriate them for use without appropriating ownership.
	Secondly, I propose the use of quick-build homes, such as those pioneered by Urban Settings, to deal with the immediate crisis. A Polish company constructs buildings—they are like Portakabins stacked on top of each other—off-site and puts them on-site. It can provide warm, dry, safe, secure and respectable accommodation, and for many people that is far better than nothing. It is not a long-term solution for many, but it is a solution for some.
	Thirdly, there should be additional funding for councils. We could talk to any of the 33 local authorities in London and to the Housing Corporation about a massive programme of new build in London, particularly of three and four-bedroom homes. If those are built, all the overcrowded people in homes with one and two bedrooms could move to homes with the three and four bedrooms that they need, releasing one and two-bedroom properties for single people, couples, couples with one or two children, or smaller families.
	Fourthly, I commend to Ministers the example of New York, which I visited last December. I suggest the urgent acquisition and conversion of hotels, as in New York, or other buildings in the middle of London to house the homeless and the low-paid. Common Ground is a brilliant project that has been going for 10 years—it was founded in New York and has spread across part of the eastern United States. It does not have the stigma of a homeless hostel, because although half the people there are homeless, the other half are low-paid workers. It has done a brilliant job. Crisis, Shelter and other organisations have been talking to Ministers about a similar project in London. That would make a huge difference.
	Lastly, in my constituency, in Blackfriars road, there is a place called Wedge house, which is the Department for Work and Pensions benefit office where homeless people in London go for their benefits. It cannot cope, and within a year or two the DWP wants to get rid of the site. I hope that Ministers will seriously consider the idea of two one-stop shops—one south of the river, one north, and both quite near the centre—where homeless people can go to have all their benefits, housing and health needs sorted out. That would offer a first point of reference instead of their being shuttled from one place to another, which is hardly satisfactory if one has nowhere to lay one's head.
	I conclude with a factual point. The other night I saw someone at my surgery—a single person who was pretty inadequate. I spent two and a half hours—this is not a criticism—waiting for an answer from the Shelter hotline. At 9.30 at night, it said that there was absolutely nowhere in London available. That is the circumstance that many people now face.
	I believe that solutions to the growing crisis are possible, but they require the political will to implement them. London local councils cannot cope on their own. The fact that the number of rough sleepers has gone down does not mean that homelessness is not a growing issue in London for more and more people every day. I hope that there can be new, positive and truly effective initiatives.

Phil Hope: I congratulate the hon. Member for Southwark, North and Bermondsey (Simon Hughes) on securing this important debate. I shall endeavour to respond to the issues that he raised.
	We can agree that, as the hon. Gentleman said, more and more people are receiving assistance from local authorities under the homelessness legislation, and that homelessness is not a problem in his borough of Southwark alone. Indeed, it is a problem not only across London but nationally, because increases have been recorded in all regions in recent years. I am sure that despite his remarks to my hon. Friend the Member for Newport, West (Paul Flynn), he recognises that some of those increases are the result of strengthened legislation. More people are being helped who might not have been given priority in the past. However, I accept that that does not entirely account for the growth in numbers.
	We are clear about the extent of the problem—it is growing and we are taking positive steps to tackle it. Ishall not repeat the hon. Gentleman's litany of statistics—human misery expressed in numbers—but I must correct him on one figure. He cited a 10 per cent. increase between 2001–02 and 2002–03, but that is wrong—the real increase was 3.5 per cent. Rather than dealing with the detail now, I will write to him to explain that error, which has entered the public domain.
	I want to pick up on the second half of the hon. Gentleman's contribution. The important thing is what we do about the problem. The Government are not shying away from it—we want to tackle it head on. I believe that we have a good track record to date. First, we have successfully reduced the number of people who sleep rough—those who are literally roofless—by no less than two thirds. In 1997, we inherited housing legislation—the Housing Act 1996—which reduced the rights of homeless people. We have strengthened the safety net for homeless people so that more people are eligible for local authority help, and widened the help that local authorities provide.
	In the short term, that has meant local authorities accepting more people as homeless and has therefore added to the numbers in temporary accommodation. Many of those people would have been left to fend for themselves under the previous legislation. More vulnerable people than ever are being helped and that includes those who are mentally or physically disabled. The consequence of the increase in the number of people who are helped is a growth in households in temporary accommodation. Of course we are greatly concerned about that, and we have acted quickly to end the scandal of households having to raise children in bed and breakfast hotels.
	It is interesting to note that, on 31 December 2002, some 2,230 families were living in bed and breakfast. That means approximately 3,600 children living in bed and breakfast accommodation. By 31 March 2004, the figure was zero. We had eliminated the problem of children and families having to live in bed and breakfast hostels. As the hon. Gentleman said, those are statistics. However, they are important: the statistics express human misery and I am delighted that we are considering a figure of zero.
	We acknowledge that some local authorities' services have been bogged down in the process of deciding whether a household asking for help is homeless under the legislation rather than concentrating on the help that could be offered to avoid homelessness. That means that households are being accepted as homeless and moved into temporary accommodation in circumstances where homelessness might have been prevented. The protection that the legislation offers, although greatly welcome, has become the only option, rather than the safety net that it should be.
	I am glad that proactive local authorities have changed their culture to develop a range of appropriate options for everyone who asks for advice. By helping someone to rebuild relationships with their family or friends, stay in education or work or deal with a drug or alcohol problem, homelessness can be prevented. We support those approaches and services that provide the right help at the right time, backed up by a robust safety net for vulnerable people. The hon. Gentleman described that as losing the battle, but I am pleased that every local authority now has a strategy in place for preventing homelessness, and that we are beginning to achieve reductions in homelessness acceptances, with London leading the way. Here, reductions in the past two quarters—that is how recently the change began to bite—were 9 per cent. compared with last year and 5 per cent. elsewhere. I believe that we are turning the corner. That is making a huge difference.

Bob Russell: It has taken seven years.

Phil Hope: As I said earlier, we have been widening the net in the past seven years to allow more people to be helped. More vulnerable people are being helped. It is crucial to deal with prevention to prevent people from becoming homeless in the first place as well as rightly tackling the provision of more accommodation to meet needs.

Bob Russell: Will the Minister give way?

Phil Hope: No, because I have only three minutes left to respond to the hon. Member for Southwark, North and Bermondsey.
	We have provided significant additional funding for local authorities and voluntary sector agencies to support delivery of their homelessness strategies, doubling previous spending plans. London has received more than half of the resources available nationally, because we recognise the unique problems that it faces. We have doubled the investment in affordable housing, and London is receiving more than 40 per cent. of the national allocation; that is some £2 billion in the current spending review period. We have also increased the investment in new provision of housing, and these prevention initiatives will together turn around the problem of homelessness.
	The hon. Gentleman raised several points on this issue, and I should like to say a little more about funding. This year, the homelessness and housing support directorate allocated £45 million to local authorities in support of their homelessness strategies. A further £14 million has been allocated to voluntary organisations, and London received the lion's share. Indeed, Southwark's allocation was one of the highest in London, receiving more than £1 million from the directorate in each of the past three years. Of course, money is not the only answer. This is about people working together, and the partnership work that has been done on rough sleeping has been hugely successful. Rough sleeping levels are now less than half their 1998 levels, and there have been notable successes.
	The hon. Gentleman mentioned empty homes. In London, the London Housing Board's discretionary funding pot for private sector renewal is funding an empty property website in the West London sub-region, and other sub-regional schemes to help to bring empty properties back into use. We have introduced a range of fiscal incentives, and in particular a VAT reduction, to encourage the renovation of long-term empty homes. We have also provided funding for the Empty Homes Agency, an independent housing charity, to work with local authorities to implement effective empty property strategies. We have published comprehensive guidance for local authorities and property owners on unlocking the potential of empty property. We will follow that up later this year with more specific guidance for Departments and the public sector. I hope that, through those measures, we have demonstrated our commitment to tackling the pernicious effects of empty homes.
	The hon. Gentleman also mentioned the question of benefits in relation to the homeless sector in London. He will know that the London homeless services team was set up specifically to address the needs of homeless people across London with regard to welfare benefits. I shall not take him through all the details, but the team works with 80 outreach organisations across London, often using a van, and it sees about 700 customers a month. The Southwark homelessness unit offers a direct access benefit-related service to a case load of more than 400 street homeless people and in excess of 100 hostel dwellers. These are good examples of joint working between the Department for Work and Pensions and local boroughs to tackle the relationship between homelessness and the benefit system.
	The hon. Gentleman mentioned the New York project. The Government are well aware of the excellent work of the Times Square project there, and have been very supportive of it. We have also encouraged innovative projects such as that in England. In particular, we are closely involved with the Crisis urban village project, and we await with interest the next stage of its development. I take his remarks on this issue very much to heart, and we are grateful for his involvement in some of these developments.
	The hon. Gentleman made a particular point about temporary accommodation. While there are more people in such accommodation now, it is important to remember that the people who have been helped have been rehoused as a result of the stronger homelessness legislation. The vast majority—more than 80 per cent.—are housed in self-contained homes in the private or social sector. We accept, however, that that number reflects a shortage of suitable housing, and we are determined to tackle that issue, too. That is why our priority for action over the next three years is to increase the number of new social rented homes.
	I have mentioned prevention, so I shall say no more about that at the moment. I want to talk about the importance of building more homes. The hon. Gentleman mentioned using a particular method of construction as a way of delivering new homes. He will remember that, at our conference in Brighton this year, the Deputy Prime Minister put out a challenge to the housing sector to try to build homes for £60,000. We then heard about some imaginative schemes involving the use of surplus public land. That is the kind of innovative thinking that is going on right now on modern methods of construction, but of course we need more money to supply quality affordable housing. We are already investing £1.4 billion in more affordable housing for London over the periods 2004–05 and 2005–06. Let me tell the House what that means: this year and next, 10,000 more homes for rent for homeless and poorly housed families; 4,000 homes for low-cost home ownership; and 8,000 homes for key workers. That is a total of 22,000, and we are not going to stop there.
	The recent spending review has announced significant additional funding, which will provide nationally an additional 75,000 social rented homes and 40,000 homes for essential public sector workers and low-cost home ownership over the three years to 2007–08. We have also provided resources to reduce nationally the number of non-decent homes—we had a debate about that earlier—by 1 million. We are determined to continue that good progress.
	We have had a short but important debate, and I hope I have shown that investment is being made in additional homes. I hope I have also shown through the statistics not only how people's lives are being affected but that the Government are taking this action seriously and that we have had a lot of good success in tackling rough sleeping and children living in bed-and-breakfast accommodation. We have a prevention agenda that is beginning to show results. With our investment in new affordable housing, we are setting the right agenda for reducing homelessness in London and across the country.
	Question put and agreed to.
	Adjourned accordingly at twenty-five minutes to Eleven o'clock.